The accepted answer's claim that the compressed image will be slower to restore is likely wrong (unless you have an SSD): with current CPUs, decompression is faster than reading more data from a hard disk. As a case in point, all applications of Snow Leopard are stored compressed to decrease launch time.
The end result is the same with all disk image formats (that's the very definition of a disk image...), but the CD/DVD master is more interoperable, while the compressed format is likely smaller and has the added advantage of a checksum.
The help of Disk Utility has this to say on the subject “Disk image formats”:
compressed:
Choose this if you don’t need to add more files to the image and you want to conserve space. The data is compressed so the disk image is smaller than the original data.
CD/DVD master:
Choose this if you want to use the disk image with a third-party application. The disk image contains a copy of all sectors of the disk, whether they’re used or not, and copies them to other CDs or DVDs bit for bit.