Live Action Role Play like flashmobs, scavenger hunts, puzzle/mystery rooms, civil war/Star Wars/etc. re-enactments, etc. have become a popular pastime. The main difference seems to me to be “telling a story” versus a “follow the script” type of activity.
LARPing (like RPGs) has some creative elements to it, but the difference between setting the stage (ie., all the rules are known) and the more free form style of an ARG and reliance on the “webverse”, seems to me to be the main differences. Plus, the reach of an ARG is international vs. LARPs are localized by nature.
They are like different sides of a coin, flip it and play!