I don't think I've heard any official word on this, but from what I have gathered from the games and the compendium, the biggest difference between a dimension and a timeline seems to be their "4th dimensional space" relationship to each other and how malleable each is.
There really are only 3 or 4 examples of dimensions in the series (depending on how one wants to count the separation of the two dimensions): The Chrono Trigger World, Home World, Another World, and the Dinopolis World.
There are numerous timelines, however: The original Timeline, the Timeline in which Marle causes her own destruction, the Timeline in which Chrono and the others save Leene, the Timeline in which Chrono and the others Travel to the Future for the first time, etc.
The two are quite similar, since what separated the Dino world from the Human world is that Lavos never fell; other than the magnitude of the event, this is similar to the differences between the timeline in which the Mayor of Porre is a jerk and when the Mayor is nice.
However, a Timeline does not seem to be the exact same as a Dimension. This is indicated by the Darkness Beyond Time; the Entity pulled Dinopolis from its own dimension, not the Darkness Beyond Time, even though Dinopolis isn't the standard timeline.
If the Dinopolis dimension were the exact same as a timeline,
then it would have been in the DBT.
I suppose, then, the Chronoverse must be averse to the formation of multiple,
Sliders-like, dimensions. It would seem that there needs to be a fairly drastic change to a "timeline" to prevent it from being sent to the DBT. The only time we see a dimension being created is in Home World/Another World, which if I recall correctly was because there become a 50/50 chance of Serge's death/life. It may be, then, that Dimensions form when timelines can't resolve which should dominate. That would then mean that Lavos had a 50/50 chance of falling to earth (thus spawning Dino and Human worlds).