This article is from the CD-Recordable FAQ, by Andy McFadden (firstname.lastname@example.org) with numerous contributions by others.
A sector on an audio CD holds 2352 bytes, enough for 1/75 of a second
of stereo sound. A sector on a MODE-1 CD-ROM holds 2048 bytes of data.
The 304 "lost" bytes are used for sector addressing, synchronization,
and error correction.
If you read a MODE-1 CD-ROM sector in "cooked" mode, you get 2048 bytes
of data. When you write that to a CD-R or CD-RW, the error correction
bytes are reconstructed. If you read that sector in "raw" mode, you get all
2352 bytes of data. If you simply wrote those bytes to a CD-R, any errors
that slipped past the CIRC encoding while reading would be propagated,
and could result in generation loss (see sections (2-17) and (3-18)).
There are times when you don't *want* to have the error correction
reconstructed. For example, some games deliberately distort the error
correction bytes as a form of copy protection. See section (2-4).
The recording software has the option of error-correcting the 2048 bytes
of CD-ROM data and even regenerating the ECC data. Doing either reduces
the risk of generation loss; doing both eliminates the risk by effectively
doing a "cooked" read and write. (Apparently some drives will error-correct
CD-ROM data for you even in "raw" mode.)
To copy a disc in "raw" mode, you need the right reader, the right writer,
and the right software. Programs like CloneCD specialize in "raw" copies,
but require that the CD-ROM drive used to read discs and the recorder used
to write them support "raw" reads and writes. The web page for CloneCD
(6-1-49) is a good place to look for a list of capable hardware.
"RAW DAO-96" refers to a method for writing "raw" 2352 byte sectors with 96
bytes of associated P-W subcode channel data (section (2-6)). This is useful
for copying discs with CD+G, CD-Text, and certain forms of copy protection.
"DAO" refers to its use in combination with disc-at-once recording.
There's also "RAW DAO-94", which is the same as DAO-96 except that the
two bytes of Q channel CRC data are always generated by the recorder, and
"RAW DAO-16", which includes only the P-Q subcode channels.