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Even for experience drivers, playing with the racing line on is recommended at least for a time. Trying to race around a track without any knowledge of what Need for Speed's rendition of it is like is a recipe for disaster, and adhering to the racing line allows one to stay competitive while learning instead of re-starting a race several times in a row whenever a new track is encountered.
That said, the racing line has its limits. There are two main problems with it. The first is it doesn't do much to account for the weight of different cars. A MX-5 can brake much later than a Nissan 350Z. As a result, trying to following the racing line often results in the MX-5 losing a lot of time from braking too early, but it will also sometimes ask the 350Z to brake too late. Remember this when driving an new car.
In addition, the racing line's colors are deceptive. In most cases red means stop, yellow means slow down, and green means go. The racing line is extremely conservative in most cases, however, so driving around corners in the green is quite a bit slower than optimal. Look for the yellow. Most cars will be able to run the racing line around corners while in the yellow. Adhering to this policy while learning the game can shave five seconds or more off each lap.
Of course, the eventual goal should be to turn the line off entirely. A good driver can carve corners much more quickly than the racing line suggests. The perfect line rests not on the track, but somewhere between your eyes, hands, brains, and guts.