Does it mean you can't make backup copies of the CD, or you won't be able to edit the files?

Yes, it means you can't make backup copies or "burn" the CD.

Always arownd this of coase though... www.gamecopyworld.com (http://www.gamecopyworld.com) tells you how.
I use clone cd to do it http://www.soccergaming.com/ubb/smile.gif

It means it's going to take a bunch of hackers at least a couple of days to copy the CD :-)