With the advent of Digital SLR Camera Bodies, the term Field of View Crop Factor has come into our world. The source of this term is the smaller-than-35mm sensor present in many of Canon and other manufacturers' DSLR sensors. Canon's EF Lenses still focus the image on the same plane as before, but sensors smaller than 35mm sensors do not capture the entire image. Thus, the image is "cropped". The Field of View Crop Factor (FOVCF from here on) refers to the amount of the image that is cropped.
Here is a diagram illustrating the size differences between Canon's currently available DSLR sensors (I personally don't expect to see any new sizes introduced by Canon in the near future).
The above image lists the FOVCF and the approximate size of the sensors. The inner rectangle, the 1.6x FOVCF, also has a shaded area around it to indicate the 95%-of-final-image viewfinder found on most of the Canon EOS DSLR camera bodies with this sensor size.
When looking through the viewfinder on Canon's DSLR cameras, the sensor size is immediately obvious as the viewfinder size generally reflects the sensor size. A full-frame viewfinder is large - and very nice. The 1.6x viewfinders are smaller - nice, but smaller and generally showing only 95% of the final image. One issue with the 95% viewfinder is that you can get objects in your picture that you don't want - and can't see during the shot. This is generally not a big deal, but certainly a difference. Canon's full-frame 1-Series bodies generally have 100% viewfinders. Although it is a full-frame body, the Canon EOS 5D Digital SLR has a 96% viewfinder.
I should also note that what is seen in the viewfinder is also affected by viewfinder magnification which varies across Canon's EOS line. Viewfinder magnification has no affect on the final image.
Most of the Canon Digital SLR reviews on the site contain a table illustrating sensor and viewfinder differences.
The subject framing is significantly different between the various FOVCF DSLRs when using the same focal length lens and the same subject distance.
I'll say it again - the subject framing is significantly different.
"Focal Length Multiplier" is a not-exactly-correct-but-helpful term that many like to use to describe the Field of View Crop Factor. Although the physical focal length of a lens is not actually changed on a FOVCF camera, the subject framing certainly is. By multiplying the lens focal length (or focal length range) by the FOVCF, you get the full-frame focal length lens subject framing equivalent when used at the same distance. For example, if you are looking for similar framing that a 50mm lens (the classic "normal" lens) provides on a full-frame (1.0x crop factor) SLR body, you probably want a 35mm lens on your 1.6x FOVCF body. 35mm x 1.6 = similar framing to a 56mm lens on a full-frame camera body. This focal length is often referred to as the "Effective Focal Length". The lens is still a 35mm lens, but your final image will only include a crop of the lens' complete image.
What affect does the FOVCF have on lenses? None - physically. The lenses are the same and retain all of their same physical attributes. But, there are some differences in how these lenses are used that should be mentioned ...
First, most lenses produce the highest quality image from near the center of their image circles. Distortion, softness (opposite of sharpness), vignetting ... These issues often show up in the outside portion of the image circle. Since the FOVCF DSLRs utilize only the center portion of a Canon EF Lens, they often avoid a lens' weaknesses. I say "Canon EF Lens" because Canon EF-S Lenses are made specifically for the 1.6x FOVCF DSLR bodies (but still require the same FOVCF to be applied as the standard Canon EF Lenses to get the equivalent focal length comparison). EF Lens hoods are designed for full-frame bodies.
Another difference has to do with Depth of Field (DOF). The acceptable DOF produced by a lens relates to the actual focal length, aperture setting, subject distance, circle of confusion and sensor size. While the size of the sensor affects DOF, the significant change from sensor size to sensor size is the distance from your subject required to get the same desired image framing. All other factors being equal, longer distance to the subject will result in greater acceptable DOF. So, as a generalization, using a higher FOVCF DSLR will yield more DOF in your similarly cropped pictures because you will be farther from the subject. Using a higher FOVCF will make it harder to blur the background and easier to keep/get the subject in focus. The amount of difference is about the same as the crop factor (1.3x, 1.6x). As focus distances approach infinity, this difference goes away. A good way to learn more about this topic is to plug your own numbers into the Depth of Field Calculator at DOFMaster.
I often hear wildlife photographers singing the praises of the high FOVCF (1.3x, 1.6x) DSLRs. They like that they can achieve tight subject framing from a longer distance - or with smaller, less expensive lenses. Using a Canon EF 500mm f/4L IS Telephoto Lens on a 1.6x FOVCF DSLR yields the same subject framing as an 800mm f/4 IS lens on a full frame body. Adding a 1.4x Extender to the kit results in a super-long 1120mm f/5.6 subject-framing-equivalent focal length lens. But, this is not quite all of the story. A 1.0x DSLR with a higher pixel density sensor than a 1.6x DSLR will be able to capture a subject larger (more detail in the picture) than the higher FOVCF DSLR - the 1.0x image would require cropping for the same subject framing, and I'm assuming equivalent individual pixel quality to make the comparison easy. This would be a good point to insert the fact that a higher pixel density sensor places higher demands on the lens being used. Any aberrations present become exaggerated.
Photographers who shoot at wide angles are the ones who dislike the high FOVCF DSLRs the most. Cropping is not an option if the subject is not in the frame. The introduction of the Canon EF-S 10-22mm USM Lens was the answer to this problem for many of these photographers who are using a EF-S lens compatible DSLRs.
A nice point about all of Canon's DSLRs is that they maintain a 3:2 aspect ratio. A 4x6 will print uncropped, 5x7 and 8x10 prints will need to be cropped. There is no need to be concerned about which FOVCF DSLR was used to take the picture.
As of today, Canon uses APS-C 1.6x sensors in the consumer xx0D and prosumer x0D lines. Canon's 1D line uses 1.3x sensors, and the 1Ds and 5D lines use 1.0x full frame sensors.
You may find Canon's Full-Frame CMOS White Paper (1.1 MB .PDF file) informative as well.
I hope that wasn't too confusing.