When the device boots, it searches SD:, USB0: and USB1: in that order, for supported disk images. It will recursively enter directories as it encounters them, so it may search a subdirectory on a disk before finding a file (e.g. it may find usb0:/a/game.iso before it finds usb0:/game.iso). This is dependent on the order in which files are stored in the filesystem on disk.

ISO files are supported. By default, the firmware will assume a normal sector size of 2048 in mode1 (as per a normal CD or DVD), but it will inspect the contents for an ISO9660 header to detect certain other sector sizes (e.g. CD-i formats, used by at least one Namco246 game).

To support other formats explicitly, alongside audio tracks, the game will also look for CUE files. Regardless of whether they're a single BIN file, or split into BIN/WAV, the firmware will attempt to parse the CUE correctly and load all relevant files automatically. This provides support for various CD-i/Mode2/etc. formats.