Buddhas (仏 hotoke) are the reincarnation of spirits of people who have attained full enlightenment. While they are often grouped up with gods, they are very different in many ways. They are different than gods like the Yaoyorozu no Kami in that buddhas are pacifistic and are there to guide other people into enlightenment while the gods ally with humans seeking worship and can act aggressive when given the situation. While the buddha is a reincarnation of an enlightened person, a god can be born biologically, evolved from a living creature who attained some form of divinity, or simply having an unknown origin.
Buddhas in Touhou
Buddhas are mentioned by Byakuren Hijiri in Undefined Fantastic Object. While she states that youkai, gods and buddhas as the same, she appears to leave buddhas out in later comparisons to youkai. In Sanae Kochiya's senario B, Byakuren tells Sanae that a god such as herself could understand her ideals, and in scenario A, tells her that she is shallow for blindly following Kanako Yasaka's orders. This indicates that while Byakuren will follow the teaching of the Buddha and relies of their guidance; she makes the distinction between that and the teachings of a god.
While mentioned, none have been confirmed to have appeared as of yet. In Wild and Horned Hermit chapter 9, Marisa and Reimu are listing off some of Reimu's recent opponents and mention one being a buddha, which appears to be a reference to Byakuren. Reimu decides she probably counts as a buddha, but is a bit unsure.