In the Chola administration, 'Ur' referred to the assembly of villagers, typically found in areas with peasant settlements, while 'Nadu' was a larger administrative unit comprising several 'Urs' or villages. These 'Nadus' often had their own assemblies and played a crucial role in local self-governance, including collecting taxes and administering justice. The other options are incorrect as 'Ur' and 'Nadu' were key geographical and administrative divisions.