There is an expectation difference between Pleasure driving, Combined driving and breed ring driving. In the ADS type driving (pleasure and combined) one usually has a whip whose stock reached approximately the saddle of the harness and the lash (including the cracker which is usually 12") reaches the shoulder of the farthest horse if you are driving multiples or just the shoulder of your single. People have individual preferences, of course, and often the formula is that the stock is twice as long as the lash assembly but some like more lash and some less. The lash is used to lightly flick on your horse's shoulder or behind the girth to assist in bending and forward body positions more than speed.
The type of whip that only has a tassel in the end was designed for harness racing as the stock part is used only for whipping to speed since directing bend and other fine points are not required. You do see this type of whip in the breed ring, sometimes, but from a driving and training point of view, the longer lash type is more appropriate.
The reason that ADS rules require you to have a whip in your hand at all times is for safety. If you need it in an emergency, it will take too long to bend over to get it out of the whip holder. A shame one has to 'legislate' common sense, but I am glad that they have.