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The best thing about site collection administrators is that they can do anything in a site collection. It is also the worst thing. If a normal user is also a site collection administrator then they see everything in the site collection. This can present some problems if confidential material is kept on SharePoint. So to clarify when you need a site collection administrator I have compiled some information below to help sort things out.

Site Collection Administrators

• Have full rights to all sites within a site collection.
• Can view, add, delete, or change all content within a site collection.
• Can add/remove users from any site.

Site Collection Owners

• Site collection administrators
• Only two (Primary and Secondary)
• Added when site collection is created.
• Modified in Manage Site Collection Owners page in Central Administration
• Only site collection owners receive e-mail notifications for such items as pending deletion of inactive sites and quota limits approached.
• Receives requests for site access by default but can be changed to be sent to someone else.
• You can also use stsadm to change site owners.
  stsadm.exe -o siteowner -url URL [-ownerlogin DOMAIN\User_Name | -secondownerlogin DOMAIN\User_Name]

Things only a Site Collection Administrator can do

Change the following

• Search settings
• Search scopes
• Search keywords
• Recycle bin
• Site collection features
• Site hierarchy
• Site collection navigation
• Site collection audit settings
• Portal site connection
• Site collection policies
• Content type publishing
• Site collection cache profiles
• Site collection output cache
• Site collection object cache
• Variations
• Variation labels
• Variation logs
• Translatable columns
• Suggested Content Browser Locations
• SharePoint Designer Settings
• Visual Upgrade
• Help Settings