In QM states are vectors in a Hilbert space $\mathscr{H}$. These are often denoted like $|\psi\rangle$.
On the other hand, in the algebraic approach, we have one $\ast$-algebra $\mathscr{A}$ and states are linear functionals $\omega : \mathscr{A}\to \mathbb{C}$ such that $\omega(a^\ast a)\in [0,\infty)$ and $\omega(1)=1$.
It is not at all clear how these two things are related.
For a first step, we have the GNS construction. The GNS construction is the following:
GNS Construction: Given a $\ast$-algebra $\mathscr{A}$ and a state $\omega : \mathscr{A}\to \mathbb{C}$ we can construct one Hilbert space $\mathscr{H}_\omega$, one $\ast$-representation $\pi_{\omega} : \mathscr{A}\to \mathscr{A}(\mathscr{H}_\omega)$ and one $\Omega \in \mathscr{H}$ such that $\pi_{\omega}(\mathscr{A})\Omega$ is dense and $$\omega(a)=\langle \Omega ,\pi_\omega(a)\Omega\rangle.$$
Now we have some interesting things:
Every algebraic state $\omega$ gives rise to a whole Hilbert space on which $\omega$ becomes the distinguished $\Omega$ and it produces one mean value on the usual QM sense.
The other unit vectors on the Hilbert space give rise to algebraic states. Actually, if $\Phi\in \mathscr{H}$ we have that $$\omega_\Phi(a)=\langle \Phi, \pi_{\omega}(a)\Phi\rangle$$ is one algebraic state. It is obviously a linear functional and certainly satisfies $\omega_{\Phi}(1)=1$ and $$\omega_{\Phi}(a^\ast a)=\langle \Phi,\pi_{\omega}(a^\ast a)\Phi\rangle=\langle \Phi,\pi_{\omega}(a^\ast)\pi_{\omega}(a)\Phi\rangle=\langle \Phi,\pi_{\omega}(a)^\ast \pi_\omega(a)\Phi\rangle=\langle \pi_\omega(a)\Phi,\pi_{\omega}( a)\Phi\rangle=|\Phi|^2\in [0,+\infty)$$
On the other hand it doesn't seem that every algebraic state gives rise to one usual state in $\mathscr{H}_\omega$. In truth, because of the Riesz representation theorem it would suffice that to every algebraic state $\phi$ there was one algebraic state $\tilde{\Phi}$ on $\mathscr{A}(\mathscr{H}_\omega)$. This in turn requires that $\tilde{\Phi}(\pi_{\omega}(a))=\phi(a)$ thus for this to be true we would need $\pi_\omega$ to be invertible. In other words, the representation must be faithful.
These points show that although related to the usual state vectors from QM, the algebraic states aren't equivalent to them. In fact, it seems we have more algebraic states than state vectors.
Furthermore, GNS allows us to indeed represent each state as a state vector, but on different Hilbert spaces. The point (2) I made then guarantee that each such state vector can be identified with one algebraic states, but there are other apart from it which do not belong on this Hilbert space. Even, though, if we pick one of those states in (2) and perform the GNS construction with them it seems we get an entirely different Hibert space.
It seems that the role of algebraic states is to generate a representation only and this is quite strange, considering the usual QM point of view on states.
So what is the correct way to understand algebraic states? How they relate to the usual notion of states from QM? To work with them in practice do we always need to use the GNS construction?
How do we deal with the fact that it appears that there are more algebraic states than QM vector states, in the sense that when we perform the GNS construction some algebraic states appear to be "left out"?