A live cd can be made from many different OS's. Each OS's live CD is generally a limited version of the full install.
Newer machines can boot from a CD. Since it can boot it can also run and load an OS. What is changing is that instead of the computer using the hard drive to boot and load you use the CD to boot and load. Most live CD's run only from the CD. That is to say they don't require a hard drive at all nor even affect the hard drive unless you allow it. The CD is all one would need to test or try or even use full time an OS. Since the access on a CD is much slower the user will notice a seeming slow machine. The newest offer from any sort of beos is from a company called yellowtab. The have a free live cd.
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