TextEdit has its roots in OPENSTEP, where it was used as kind of a demo application of the text views IIRC. It even came with source code, as did Chess by the way.
So I guess a comparison between TextEdit and Pages doesn't make too much maybe, they're really different things.
Pages is an underrated Word Processor. It has the lessons of 30 years of development and experimentation of WYSIWYG editors distilled and applied in a tight little package.
Also Pages also has a fairly decent print design mode. Sure, it can't compete with something like Indesign in feature parity, but I find it pretty useful to do posters, booklets, flyers and the like. It's free and fairly intuitive to use.
So I guess a comparison between TextEdit and Pages doesn't make too much maybe, they're really different things.