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  A variety of copy-protection schemes are commercially available. Some are
  simple, others are more complex. If you're interested in devising your own
  scheme, however, here are some things to consider.

  For diskettes, there are dozens of ways to approach copy protection.
  Perhaps the most common methods involve reformatting the sectors in
  certain tracks on the diskette by using the ROM BIOS format routines.
  Because DOS cannot read sectors that don't conform to its specific
  formats, the DOS COPY program can't copy a disk that has an occasional odd
  sector size interspersed with normal sectors. This DOS limitation inspired
  a number of companies to produce copy programs that can read and copy
  sectors of any size, so it is not a particularly effective means of copy
  protection.

  On a more advanced level, there are two special aspects of diskette copy
  protection that are worth noting. First, some of the most exotic and
  unbreakable protection schemes have been based on the discovery of
  undocumented abilities hidden in the diskette-drive controller. Second,
  some protection schemes are intentionally or unintentionally dependent
  upon the particular characteristics of different diskette drives. This
  means that a copy-protected program may function on one model of computer
  but fail to function on another model, even though the copy protection has
  not been tampered with. If you use a copy-protection scheme, keep this in
  mind.

  Many of the copy-protection techniques used on diskettes are not
  appropriate for fixed disks, mainly because most fixed-disk users need to
  be able to make backup copies of programs on their fixed disks. This means
  you should avoid copy-protection schemes that prevent fixed-disk backups
  by making it impossible for DOS or the ROM BIOS to read part of the disk.
  Most of the fixed-disk copy-protection schemes in use today rely on
  data-encryption techniques, which discourage software piracy without
  preventing legitimate copying.

  In an encrypted program, the program's executable code and data are stored
  on the disk in an encrypted, hard-to-unravel format. When you execute the
  program, a special start-up program decrypts the encrypted code and data
  so that it can be used. The start-up program might also rely on data saved
  in hidden files or subdirectories to decrypt the main program.

  There is no particular additional guidance that we can give you here,
  except to remind you that variety and ingenuity are the keys to successful
  copy protection.