PCB1 is part of the floppy disk drive. It takes care of low level drive functions such as amplifying the analog signals going to and from the read/write heads, producing the 4 phases that operate the head stepping motor, switching power to the drive motor etc.
It interfaces to the Floppy Disk Controller/Interface card (PCB2) via a 34 way ribbon cable. The particular interface 'standard' used in the IBM PC (and been adopted by most other manufacturers) was designed by Shugart Associates.
Most of the signals in the cable are common to both drives - only the Drive Select and Motor On lines are different. This allows a single cable to be 'daisy-chained' from one drive to the other. In the cable between the drives you can see that part of the ribbon is twisted in the middle. This swaps the Drive Select and Motor On lines over so that both drives can have the same pinout but be selected as drive A or B depending on where they are plugged into the cable.
The Floppy Disk Controller interfaces between the CPU bus and the floppy drive. It takes commands and data from the CPU and operates the various interface lines that tell the drive to do things such as turning the motor on, stepping the heads from track to track, and enabling the read or write circuit. It also converts the data from parallel bytes to the special MFM serial format that is required to store it on disk.