Technical terms are Modulus of Elasticity (MOE) and Modulus of Rupture (MOR).
In oversimplified terms, MOE is the point to which the wood can bend and recover fully. MOR is the point where it won't recover fully, where some of the fibers have ruptured. When a bow takes a set, the MOR of some fibers has been exceeded, and there's nothing you can do about it. Both are affected by moisture content, so more moisture means less strength for both. Set represents a permanent loss of strength and form. Mess with it and you'll make it worse.