Defensive casting mode allows casting without triggering an attack of opportunity. However a concentration skill check (DC 15 + spell level) must be made or else the spell is lost. There is a -4 penalty (increasing the DC) if there is an enemy within 4 meters and the caster does not have the combat casting feat. Thus, without that feat, it takes a concentration skill of 27 to guarantee passing this mode's check for any spell.
Defensive casting is a combat mode. It cannot be used at the same time as other combat modes. Movement and other non-combat actions will cancel the mode.
The improved combat casting feat provides the same benefit as this mode without precluding the use of other combat modes. (That feat also does not require concentration checks, but with its prerequisite 25 ranks in concentration, the checks would likely be passed anyway.)