What do ppl use a `winuae HD file` for anyway, is it faster?
It used to be. I'm not sure it makes a lot of difference on reasonably modern systems, though.
The biggest benefit it offers is protection. Both from errant UAE activity, as well as errant user activity.
With a UAE HDFile, if UAE crashes in a write, it can't damage your host filesystem. The same has not always been said about using a directory as a UAE HD.
Also with a UAE HDFile, you can't accidently cause a sync error by accessing the UAE directory through your host OS while UAE is running.