This article is from the CD-Recordable FAQ, by Andy McFadden (firstname.lastname@example.org) with numerous contributions by others.
This is a general CD-ROM question rather than a CD-R question, but since
some of the newer recorders are available in either configuration it
seems worthwhile to address it here.
The advantage of a tray is convenience. If you want to put a CD in the
drive, you can just drop it in, instead of buying a pile of caddies and
hunting for a free one.
The advantage of a caddy is durability. CDs are less likely to be
scratched if they're put into a caddy and left there (VERY important if
you have children), and the internal mechanism is less likely to collect
dust. The tray units usually have a worse MTBF rating, because they have
more moving parts.
There have been reports that, at 12x and higher, some CDs will cause loud
vibrations in tray models, but work fine in caddy models. Not everyone
has had this problem though.
It used to be the case that you had to get a caddy drive if you wanted to
mount it sideways, but many tray models have tabs that will hold the CD in
place. Having to use the tabs does reduce the convenience normally offered
by a tray model though.
Which you should choose depends on your needs and circumstances. If you
are planning to write to a disc several times (multisession, packet
writing, or anything with CD-RW), you are better off with the disc in a