It's true that you need the hacked software (FW and BM) in order to play backups. The original software doesn't support backups due to terms of legality.
But about whoever told you that some of the boot modes can cause chip/laser damage was talking complete nonsense.
Enhanced mode is the same as the autoboot, the game is started with all patches and fixes applied with BM.
Minimal mode shuts down BM, so there are no patches and fixes active and the game is booted with minimal chip functions.
Sleep mode completely disables the chip before booting the game, it's the same as the hardware sleep mode, but a bit more convenient since you don't have to hit the reset button 6 times.
Look at the CC Wiki for more informations and tutorials. Links for the Wiki and the hacked FW are in my signature.
best regards Jones23