Dynamic mics are what you will normally find on a stage. The typical hand held mic, with the ball on top, is usually dynamic. It is less sensitive than a condenser mic and requires the source to be closer to the mic. This is good if you have monitors on your stage. If the mic is too sensitive it will pick up your monitors and you will have feedback. You will typically use a dynamic mic on vocalists and single instruments. They are good for guitar amplifiers too.
Condenser mics are also used on stages, but for different applications. Because they are more sensitive, you need to be very careful where they are positioned. They are more susceptible to feedback, but can be very useful. They are great for picking up groups of instruments like a horn section or a string section. If you have an orchestra or a group of instruments on your stage then you will most likely want to use a condenser mic.
The ultimate goal is to find the balance between the number of microphones on your stage and being able to pick everything up you want.
Vocals – dynamic hand held microphone
Single instrument (trumpet, guitar amp etc.) – dynamic instrument mic
Group of instruments – condenser mic.
Piano – combination or piano pickup
Don’t be afraid to experiment. There is no right or wrong way to mic anything. Every stage and every room will sound different. There are guidelines, but none of them are rules.