Cool and Quiet lower the voltage and MHz of your CPU therefore uses less power and produce less heat, the cool part, and with less heat, your fan runs at lower speed, the quiet part.
Cool 'n Quiet only works if CPU is running less intensive applications, near idle, or at idle.
BIOS setting need to be enable in order to take advantage of the feature. CnQ driver is for Windows' power management, so you can set it as part of power management profile. Asus CnQ utility is just a tool for monitoring the "switching" of MHz and voltage. AMD have a tool for that too called Power Monitor available at their site.
Intel's counterpart of this is Speedstep.