The recovery CD that comes with some OEM computers are custom made. It boots on MS-DOS and runs a custom application that may or may not format your HDD, but it will copy everything from a compressed image to your C:\windows directory, overwriting everything.
If you want to make something like that, what you need is a bit image copying program such as the Norton Ghost. What you do is this:
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Do a clean install. That is, format the relevant drive(s) first.
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Install Windows, updates, drivers, applications, etc.
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Run the bit image copying program, send the output to a CD-R.
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Depending on the program, you may need to make a boot diskette.