Debug DIPs are like software DIPs, but can't normally be changed by the player on any hardware. They are often used to acces various debug options in games such as job meters, sprite viewers, parameters dumping, level jumping...
They are believed to be originally mapped to real dipswitches on SNK devcarts.
The "Developer mode" is also enabled when BIOS_DEVMODE ($10FE80 ) is nonzero.
CD BIOS call $000582 clears first 2 bytes at $10E (?)