What is different between FileStream and StreamWriter in dotnet?

A FileStream is a Stream. Like all Streams it only deals with byte[] data.

A StreamWriter is a TextWriter, a Stream-decorator. A TextWriter converts or encodes Text data like string or char to byte[] and then writes it to the linked Stream.

What context are you supposed to use it? What is their advantage and disadvantage?

You use a bare FileStream when you have byte[] data. You add a StreamWriter when you want to write text.

Is it possible to combine these two into one?

Yes. You always need a Stream to create a StreamWriter. System.IO.File.CreateText("path") will create them in combination and then you only have to Dispose() the outer writer.