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I've been curious for a while, but will a game disc still function after making an ISO file with it?

Of course,why do you think it wont?
The program only read the disk like pcsx2

Ok, so if I'm understanding correctly, you can use a PS2 disc to make an ISO file, and then the PS2 disc will still function on PS2's?

Yes, whatever program you use to make the ISO will only read the data on the disc and not modify the disc in any way. Unless of course you have a very very bad luck day where your DVD drive decides to malfunction and destroy your disc... but yeah that's unlikely to happen

Ok! Thank you very much

It's kinda like a copy + paste, rather than a cut + paste. The original data isn't touched.