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OMG!!! You didn’t know?!?! 😮
I have a feeling you’re pulling my leg here. 🙁
FYI: CSO is compressed ISO.
Custom Firmware allows you to mod your PSP so to play downloaded games directly from the memory stick. Downloaded games normally comes as ISO files but I normally compress it to CSO formats, which custom firmwares also supports. Although arguable, I personally feel CSO formats load faster, probably because of its size. Others argue that CSO should take longer to load because the PSP needs to decompress before it can be processed. That makes sense too.
The purpose of upgrading firmware is to ensure the latest games can be played. I normally do not upgrade until I found a game that I cannot run. The last time I upgraded was over a year ago, at the time upgrade to v3.52 M33 Rev2