Top photo: handwoven cloth in loom state
Bottom photo: detail of cloth after finishing
"Loom state" describes fabric that has not yet been finished or dyed. In the textile industry, such fabric is also called "gray" or "griege."
The finishing process is particularly important to weavers because, as I like to say, "It ain't over till it's finished" (with a nod to Yogi Berra). Woven fabric isn't ready to use until it's properly washed. Unfinished or unwashed, it will retain some of the tension that it was under during the weaving process and thus won't feel or behave optimally.
Differential shrinkage takes the process one step further, creating a puckered or pleated fabric, using warm water, gentle soap and lots of agitation by hand or machine. With this technique, one block or group of yarns (such as the turquoise 18/2 merino in the photos above) will full and shrink while the other (the 10/2 cotton in gold) doesn't, creating lots of texture and visual interest.
Deflected Double Weave works well for differential shrinkage because of the plentiful floats and open spaces that alternate with blocks of plain weave. By definition, it has two layers that weave in and out of each other (but never on top of each other, hence the term "deflected").
When I posted some photos on Facebook -- after fulling to create differential shrinkage -- one weaver thought the fabric was stitched double weave. I explained that it only appeared that way because the layers of wool fuse together and the cotton relaxes, losing the gaps between blocks and appearing as if it were one layer.
Here's what the back of the fabric looks like before finishing -- that is, in loom state. (My apologies for the fuzzy image, but I was using my iPhone in reverse to photograph the underside of the fabric while it was on the loom.)