Strictly, a bird dog finds properties and passes the information to an investor for a finder's fee. No contract, no title, no capital. The second person you describe was wholesaling: they put the property under contract themselves and then sold or assigned that contract for a fee. Those are different roles with different exposure, and the market uses "bird dog" loosely for both, which is where your confusion came from.
The practical test is whether the person ever holds a contractual interest in the property. A bird dog never does. That's also why the role sits clear of most licensing rules: you're passing information, and you never represent anyone in a transaction or negotiate terms on someone else's behalf.
The "illegal in some states" claim usually comes from two places. One is that several states have tightened the rules on marketing a contract you don't own, which hits wholesalers directly. The other is that real estate licensing statutes cover getting compensated for helping to bring about a sale, and how broadly that's written differs state to state. Which side of the line a specific arrangement falls on depends on the statute where the property sits, so that question belongs to a real estate attorney licensed in that state rather than a forum.
For what you're actually deciding: if someone hands you an address and a phone number and asks for $300 when you close, you're paying a finder. If they hand you a signed purchase agreement and want $8,000, that's a different transaction with different documents, and you should read the assignment language before you agree to anything.
