Playing backups on a real PS3 console is a much more advanced and legally complex process. It almost always requires or a hybrid firmware (HEN) on the console, which voids the warranty and can lead to a ban from the PlayStation Network. Once the console is modified, you can transfer the game files to its internal hard drive using a USB drive or an FTP connection over a network.
This is the most common method found on the internet. Decryptors and uploaders take a standard PS3 ISO or JB Folder game and run it through advanced compression algorithms like 7-Zip (using LZMA2 compression). Ps3 Game Highly Compressed
RPCS3 requires the official PS3 firmware. Download PS3UPDAT.PUP from Sony’s website. In RPCS3, go to File → Install Firmware and select the file. Playing backups on a real PS3 console is
Used for disc-based games, these are often "stripped" of dummy files to save space . This is the most common method found on the internet
Practical tips for managing compressed PS3 games
The concept of "highly compressed" PS3 games is largely a myth or a misunderstanding of how game data works. While you might find files online claiming to compress a 40GB game into a few hundred megabytes, these are almost always either fake, corrupted, or contain malicious software. Why "Highly Compressed" PS3 Games Don't Truly Exist Encrypted and Pre-Compressed Data