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Is there a actual usage difference between these two pronouns? Or is it simply that こちらの is more formal than この?

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こちら is very often used to talk about people as well as a simple replacement to この. You are likely to have heard the phrase:

こちらこそ

Along the lines of "I'm the one who should be saying that"

This is an example of こちら being used to refer to people, specifically the self. In phone calls, and letters, people very often use こちら in place of 私. This commonly refers to the speaker's own situation, or their self, but often is used generally to refer to a group of people one is affiliated with, rather than an individual themselves. An example of this is:

こちらは天気がいいです, said in a letter, for example.

An alternative usage is when directing people, meaning "this way" (written in Kanji as 此方, though I rarely see people use this in recent years). In shops, or even by people all over, phrases such as こちらへください is common to use, meaning "this way please" to direct them.

Equally, you can use こちら to mean これ in polite language, then, as you mentioned, this extends to using こちらの rather than この.

Hopefully this is helpful in showing the versatility of こちら, a very useful word in Japanese that extends far beyond one usage.

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