You will see what exactly it is doing by creating input binary file with 256 bytes from 0x00 to 0xFF. The result binary file is 0x01...0x0D, 0x18...0x80. It removes 0x00, 0x0E...0x17, and 0x81-0xFF. The -dc say exactly to remove everything else but to keep only the bytes from the selected octal ranges. I'm only surprised that it deletes also 0x81 ... \200, but it may be related to that tr is used for character ranges. But in that case why it pass 0x80 is a mystery.