The cwr method is based of of Clockwork Recovery, which is a program/operating system that allows you to make backups of the Nook, and also install .zip files which copy/install files from the sd card to the main memory of the Nook. This copying is done when the Nook isn't using the system files because it is in recovery mode, so the sytem files can be modified (this is when the rooting happens).
Here is the method I used:
http://forum.xda-developers.com/show....php?t=1346748
I would suggest using the beta5 method, which will do a backup for you.