The "distinction" is like those between color and colour; odor and odour; visualize and visualise - for the verb meaning (1) to beat or (2) to scold or berate, lambaste is the preferred spelling in American and Canadian English, while lambast is preferred in varieties of English from outside North America.
As for the pronunciation, as a British English speaker, I pronounce both 'a' vowels like those in crash, dash, hat, mat, cat etc. I see that Cambridge Dictionaries provides audio samples of US and UK pronunciation:
http://dictionary.cambridge.org/pronunciation/english/lambaste
It seems that North Americans pronounce the -baste part to rhyme with haste, baste, paste, waste, etc.