Image
All image layers
are rasterized and rendered as shown in your PSD.
In reality, an image is an image
! You dont save much by applying a dropshadow to an image at runtime vs. loading a PNG.
Image Layers with Effects
Layer becomes rasterized/flattened
All layer effects and styles are rasterized and rendered with the image in the Output.
External Images
No change
, rendered as is
Any image file you open in your PSD (jpg, png, or gif) will render as is in the Output.
Rasterized Images
No change
, rendered as is
Any layer [rasterized] in your PSD will render as is in the Output.