As far as I know, you should still be able to burn CD-RW discs from the Finder, but all the unused space will be lost because it actually burns the free space.
First, go to the "CDs & DVDs" preference pane in System Preferences. For "When you insert a blank CD", make sure it says "Ask what to do". Also, make sure your CD burner is on
this list of supported drives. If it isn't, it may still work, so continue.
Now, insert a *blank* CD into your CD burner. A window should pop up once it loads (it may take about 10-20 seconds for the CD to spin up and mount), asking you with what to open it. Select "Finder" in the popup menu, and type in a name for your CD. Then press "OK". After a bit, an icon should appear on your desktop that looks like a CD and says "CDR" on it (even for a CD-RW disc).
Now, just drag all the stuff you want to burn to the CD icon. After you've copied the files, you can still open up the CD like it was already burned, but you can rearrange all the files before they are actually burned.
Now, click and drag on the CD icon. If you have your Dock visible, you'll notice it will change to a burn icon. Drag it to the burn icon and let go. Alternatively, you can just press Command-E to eject the disk, but it will ask you if you want to burn it first.
In the dialog that asks if you really want to burn the CD, select "Maximum Possible" from the speed popup menu, and then press "Burn".
Like I said before, this will lose all the free space on the CD. You can use Disk Utility instead to burn CDs without the free space, so you can burn multiple sessions on your CD-RW or CD-R.
To erase a CD-RW, go to /Applications/Utilities , and open up Disk Utility. Select the entry on the left side of the window that corresponds to the CD. Make sure it says the name of the actual CD, and that you're not clicking on the entry for the CD burner drive.
Now, click on the Erase tab, and press the "Erase" button. Once the erasing is done, it'll act just like a blank CD, and you can reinsert it into the CD burner and it will ask you again what to do with it.
Hope that helps.