My pictures are in AWR (Sony Raw) file and I'm using FastStone Image Viewer 5.5 to view them before I begin the process of editing in Photoshop CS6. When I see the pictures from FastStone Image View, I don't see anything wrong with it. But when I open them in Photoshop, I see some major curve occurring near the edge of the frame. I've included some pictures as a comparison:
Why is this happening? Is there I can do in the post to get rid of this effect?
When you are opening the images with FastStone, you are likely seeing the JPEG preview generated in-camera and attached to the raw file. If your camera is set to apply lens correction or distortion correction then it is likely being applied to the image when the JPEG preview is generated.
Lightroom generally ignores in-camera settings for things such as lens correction. So when you open the raw file in Lightroom, you're likely seeing a rendering of the image that does not have distortion correction already applied. You can create a default profile in Lightroom that is applied to each image when it is first opened than includes having lens correction enabled.
For more about how different viewers and raw converters render images differently, please see Why do RAW images look worse than JPEGs in editing programs?
The JPEG generated in camera is derived from the same raw data contained in the AWR file that Lightroom is using to generate a viewable conversion of the image on the fly. The difference is that with one (in this case the JPEG) lens correction is being automatically applied by the camera and with the other (in this case the AWR) lens correction is not being automatically applied by Lightroom when rendering an image from the same exact data. There's nothing intrinsic about the properties of JPEG and AWR, though. You might just as well have a similar situation where a camera has not applied lens correction to the JPEG preview attached to a raw file and then a raw convertor application has been set to apply lens correction when rendering the same raw data.
This is not an artifact of the Sony file format, but is related to your lens. All lenses have some amount of optical imperfections/distortion, but camera manufacturers now are compensating for these imperfections through the use of software-based "lens correction". As the earlier answer explains, one software is displaying the image with the lens correction applied, while the other software is displaying the image without the lens correction applied. But as I said at the beginning, the image is distorted because of your lens, not because of the file format.
