From PSX to PC:
In Nero, select the virtual burner, then select "CD copy" in the menu, in the "read options, check "read audio data with sub channels" and leave the rest to the default. Select burn, it will ask you where to save the image.


From PC (iso) to PSX:
Mount it with daemon tools, then use your burner (not the virtual one this time) and use "CD copy" with the same options as above.
If you don't feel like getting daemon-tools (which you should do, it's one of these tools that once you try, you keep), use in the drop down menu "file" > "burn image", select the iso, select data mode 2 and hope it works. If you use daemon-tools, d-t will recognize everything and you can then copy it without any problem.