Ok don't want to sound stupid here but we have cold air returns at the bottom of the walls and vents at the top that you can open or close, when should you have these open or closed?

Use the vents at the bottom in the heating season, and at the top with the A/C.

So the top vents are hot air returns I guess... that makes sense

Never seen vents you can alternate for heating or cooling . Top vents are supply, low vents are return. They are probably on opposite ends of the room. It forms an air circulation pattern.
You can open or close the vents if you want air in the room or not.