Please look at the datasheet for the ATmega164 or the Octolively as needed for your reference about which pin does what.
I’m not sure what your question about LEDs is about– LEDs are lit by current flowing through them. However, you can’t get current to flow with them without voltage. Similarly, voltage alone isn’t enough– there needs to be a complete path for current to flow through. As to what controls the pins, it’s the software (firmware) stored in the device.