That's actually not accurate. The copy protection is subchannel based, just like regular libcrypt, and if you copy it with CloneCD it works just fine.
The cleverness of the copy protection is what happens if the subchannel data is missing and the game detects it's pirated - instead of not running at all like most libcrypt games, it'll let you play the first level but when you talk to that fairy for the first time, she tells you that it seems you're playing a pirated version and things might not work as expected. If you continue, all sort of jank happens - sometimes you lose all your gems at random, the languages switch randomly between English, French, Spanish and German, and if you somehow make it to the final boss, the game will immediately restart - and delete all your save data.