Database Software

Hi,

I have oracle10g installed on linux. i have the database in archivelog mode and also enabled the flashback features.
now i have also scheduled a backup of the whole database and have the backups in sets containing the spfile, controlfile, archive log and datafile.
I am new to this backup and recovery using RMAN.

now what is the purpose of this backup set?
for example can this backup set be used to recover even if i lost all the datafiles.

How can i use this backup set to recover the database by doing what all damages to the database or datafiles?

what all can i do by just having this backup set stored in a separate disc like DVD? and then use this backup set in a completely new machine and build a database using just this backup set from scratch?

Can someone help me understand this backup sets concepts please?

Thanks,
Philip.