This quotation applies to Chillingworth because he attempts, with great success for a while, to convince both the town and Reverend Dimmesdale that he is simply a caring doctor who has been redeemed from the Native Americans. However, he is truly a dark and vengeful man who has made it is mission to find out which villager slept with his wife and ruin that man's soul. Once he comes to believe that Dimmesdale is this man, the separation between these two faces becomes more distinct, and we can no longer be sure which of them is the real him because, in a way, they both are.
Dimmesdale has managed to maintain the appearance of piety and honesty and sinlessness, despite the fact that he has really committed a very egregious sin: sleeping with a married woman. He feels himself to be a fraud; however, both of these faces are true sides of him. He has done something dishonest, and his failure to confess it is also problematic, but he is -- at the same time -- a really compelling minister who serves his parishioners well; we would not call him a bad man or a villain.
Finally, for Hester, there is the pious face of conformity that she wears in her community; while, at the same time, she questions them and their rules constantly. She even considers whether it is worthwhile for her to live, pondering her own suicide and the murder of Pearl, as if to save them both from their terrible circumstances in this society. However, the fact that she returns to Boston years later, when she does not have to, and resumes wearing the scarlet letter shows that, to some extent, she does accept their laws and punishment as somehow appropriate. She embodies both the conformist and the nonconformist, and it is difficult to tell which is more truly her.