Android - What does CWM back up?

According to: https://wiki.cyanogenmod.org/w/ClockWorkMod_Instructions#Making_a_backup

ClockworkMod's backup/restore feature will generally only back up the /system, /data, /cache, /sd-ext, and /dalvik-cache areas. Other partitions such as /emmc, /sdcard, and /media won't be backed up.

In fact, the backed up system will typically be saved to the /sdcard/ partition in the /clockworkmod/backup/ directory, which, depending on your device, may or may not be actually located on a physical removable SD card.

According to your question:

1. The firmware?

Definitely Yes.

2. My modifications to the firmware such as root, Xposed Framwork, installed Xposed modules, etc?

Definitely Yes.

3. My installed apps?

Definitely Yes.

4. App data?

Definitely Yes.

5. Other data I had stored on the internal SD card?

Definitely NO, /sdcard is not backed up, because of there would be a CWM backup. Read: http://forum.xda-developers.com/galaxy-s3/help/how-to-backup-internal-sdcard-t1999853

Hope it help

To add to other answer, your back up has ALL the information in your back up image as the phone has when you took back up

• /system refers to your ROM
• /data refers to your data created by apps both that came with phone and user installed apps (/data/data)
• /data/cache (the cache) refers to app data stored for quick access
• /data/dalvik-cache (the Dalvik cache) refers to storage where optimisation information of your apps is stored
• /sd-ext refers to external SD card (all CWMs do not by default save this)

Other partitions mentioned are not backed up. Compression happens if you enable it (IMO, not worth the extra time it takes, given you can always store it in external SD (by choosing it) or pull it to your PC)