A CD/DVD image like ISO or CUE/BIN is a complete copy of a CD/DVD.

Imagine that you have a CD which contains 20 files and 5 folders each holding 10 files. You want to upload the contents of your CD to a download site. Wouldn't it be easier to upload/download one CD image instead of uploading/downloading 70 files?

In other words, an image file is a package for simpler distribution of CDs and DVDs.