Mark, the reason people use InCD and other packet writing software is because the disc is formatted ahead of time so it can be used like a floppy. All XP does is allow you to drag files to your drive, but they are not actually written to the disc unless you do the second step. When you drag and drop using InCD (and others) the files are written to the CD on the fly, one less step. InCD only writes to CDRW, but there are a half dozen or more packet writing programs, some stand alone, that do both CDR and CDRW. There’s also various types of UDF (packet writing format) out there and some allow you to choose this also.
From what I read, you can have as many burning programs installed as you like, as long as you have only one packet writing program installed.