There are 2 kinds of editing. (More for advanced ADVANCED users).
Level Scripting and Bin Editing.
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Level scripting is the placing of items/creatures into the game world.
This is done by using the Free Roam App to extract the level scripts into thier override directory and then editing them using either a text editor or Albion Explorer.
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Bin Editing is editing the basic properties of the items and creatures that you then place into the level scripts.
Fable Explorer opens up to Game.bin by default. And then arranges everything into categories.
The Cdefs are sub-properties that are attached to the main items.
Such as OBJECT_IRON_SWORD has CWeaponDef and CInventoryDef attached to it that says "This is a weapon that can be placed in the inventory".
Bin editing doesn't have nearly the amount of documentation behind it that level scripting does. It's relatively new and a lot of the stuff contained in it is still unknown. Both in name and in function. A lot of experimenting needs to be done with it.