I haven't seen any 100% authoritative info on this, but the only theory I've heard that sounds reasonable at all is this: GD-ROM is actually CD-ROM with at least one "special" session that has the pits half as long (but normally wide, otherwise the laser would probably be unable to read it), and the 12X "GD-ROM reader" is actually a 24X CD-ROM reader running at half its normal rotation rate (but with the decoding electronics running full-speed). I don't know or care how warez groups do disc ripping, but I know that it can be done by connecting the DC to a PC (e.g. via a serial cable) and running a program on DC to read the files from the disc. I don't know and (for now) don't care about the details of these methods.
Anyway, from what I've seen, not too many games actually use more than the capacity of a CD. For those that do, various stuff can be chopped up to make it smaller; DC warez groups apparently do this routinely. Some examples:
- Remove the right channel of stereo music, making it mono
- Re-encode FMV and/or audio at a lower sampling rate or bitrate
- Completely remove "useless" FMV
- Remove audio tracks, hacking the game or maybe the TOC so that the game still plays music where it normally would
In other words, one of the bits of BS typically spread about "evil software pirates" (i.e. that you'll end up with inferior quality compared to an original) turns out to be true for DC warez. A number of people are also concerned about increased wear on the DC's laser motor due to games that have their file ordering screwed, thus requiring the drive to seek more often - I don't really know whether or not this fear is justified, but I wouldn't rule it out...