I wish more people getting into magic now a days would make this revelation. Not that books are BETTER than dvds/videos, its just you are more likely to find a book that will give you the foundations, than a dvd. There are dvds like that out there though, they just aren't ones people are starting with like they should.
The way I understood this, reading CC, is that the theory is the backbone idea behind the move. Some hints on why and how you can justify moves etc.
Using the theory, you can buid you own patter, you own interpretation of the move.
Magic is nothing without a good patter, presentation and technique combined.
Use the theory to get yourself familiar with the move and the idea behind, and build you skill with your own personnality.
After havinf read the whole post here, I also wanna add that I own both RRTCM and all 5 volumes of CC. For the (low) price of RRTCM, you should definitely get it. This is the book I study, and sometimes, for some moves I refer to CC for alternate or deeper explanations. It's very comfortable this way.
The whole idea of magic theory is something that can get confusing. If you expect magic theory to be like a scientific theory, you might be disappointed because many aspects of magic (from the performance to the spectator reactions) are very subjective. Anyway, I'm not going to get into what makes a theory scientific as that is a whole other ball game.
When I think of magic theory, I usually think of the following things
1) It should provide a model that enables you to abstract the problem(s) you face as a performer.
2) It should provide you with broad concepts that are applicable in a variety of situations and are aimed at answering some fundamental questions. E.g., Questions about the purpose of magic and how to achieve it.
3) It should be about more than just moves/mechanics. From what I have seen, it is more about understanding the rules of the game i.e., the way things are set up between you the performer and the audience than about the mechanics/specific details of sleights.
For example, a lot of stuff written about misdirection would fall under the category of magic theory. Also, essays that talk about the essential aspects of magic, like Paul Harris' essay on astonishment as a natural state of mind is also in this category.
Edit: You can read Paul Harris' essay here and see if it makes sense to you.