Our hair requires a lot moisture, the ends especially. To seal in the moisture some people use a heavy oil, like castor oil. Bagging, is just using a shower cap (aka processing cap). Again the point of bagging is to keep moisture. For example, I baggy my hair at night. I wet my hair (you don't have to) slap on some conditioner and go to bed. This is baggying my hair. Someone recently posted a great newbie guide post. Hopefully someone else can add the link.