What's missing for clarity's sake is some form of power running to the "powered current loop input" diagram. If the diagram were fully annotated, there would be a couple lines running to the transmitter box labeled "power', whether it's DC or AC. The diagram assumes that you know that the transmitter is hooked up to some form of power that is used to power the output, just from the description "powered current loop input". That is referred to as an "active output".
In the lower half of the diagram, "unpowered" means that the power that the instrument needs to produce its 4-20mA output is not provided internally (like it would be in a "powered" instrument), but the power to drive the 4-20mA output comes from an external power supply, normally called the loop power supply.
In a loop powered transmitter, roughly 3.5mA of the current running through the loop is used by the instrument to power its internal functions - sensor, amplifier, A/D, uP, D/A. The instrument's output circuitry regulates the current between 4mA and 20mA as an "output signal".
A 3rd case is not shown. That's a powered instrument, whose output is 'passive' and needs to be powered by a loop power supply. This is done so that a common loop power supply can be used in order to avoid one source of ground loops, which is multiple power supplies whose outputs are not all floating.
There are loop powered instruments that use an external power supply for both instrument power and 4-20mA output power and where the power supply is in the output loop. (2 wire loop powered instrument)
There are the powered instruments whose output is loop powered, so 2 sources of power are necessary, one to power the instrument, a second power source to power the loop. (4 wire instrument, passive output)
There are powered instruments whose output is powered from the instrument's power source, where the power supply is NOT in the output loop like it is with a loop powered instrument. There are connections for power and separate connections for the output.
(4 wire instrument, active output)
Dan