Your offenses influence your damage against another player. Taijutsu offense, for example, will increase the damage you do with taijutsu-type jutsu.
It is recommended that you choose one offense to start with, and train it alone, as this maximizes your chances of achieving high damage. Once you've capped that offense, all defenses, and all generals, it might be a good idea to branch out into another offense. Especially if you have a bloodline with a weakness against an offense, as you can then train the offense your opposite bloodline is weak against.
Your defenses influence the damage done to you by other players. Weapons defense, for example, will decrease the damage you take from weapons-type jutsu.
It is recommended that you train most, if not all, of your defenses, to be well-prepared against all kinds of opponents.
Your 'generals' are Strength, Intelligence, Speed, and Willpower. They each affect different jutsu, both offensively and defensively, and aid in other aspects of combat as well. Though the damage formula in TheNinja-RPG is still a secret, it can be assumed from experience that generals are multiplied with offense and defense to determine damage. Because of this, it is important to also train general stats along with offense and defense.
It is recommended that you train all your generals.