DNA replication : binding
Both. You should note that activation in this case involves recruitment of RNA polymerase to drive transcription, and that this process is irrelevant to DNA replication. B in the figure shows amino acid contacts (from CAP) with specific nucleotides in the DNA duplex.

DNA binding by CAP: structure of the CAP-DNA complex.

(A) Structure of CAP in complex with its consensus DNA site (PDB 1RUN) [14], showing primary- and secondary-kink sites. CAP is in cyan; DNA and cAMP bound to CAP are in red. The crystallization DNA fragment contained a single-phosphate gap between positions 9 and 10 of each DNA half-site (Fig 1b).

(B) Summary of CAP-DNA interactions. Shaded boxes indicate positions at which CAP exhibits strong sequence preferences [11,15,16,17]. The black circle, black rectangles, and black diamonds indicate, respectively, the two fold-symmetry axis, the primary-kink sites; and the secondary-kink sites. The black vertical lines indicate the positions of single-phosphate gaps present in the crystallization DNA fragment. The cyan ovals and cyan circles indicate, respectively, amino acid-base contacts and amino acid-phosphate contacts.

Figure from:
Catherine L. Lawson, et al. 2004. Catabolite activator protein (CAP): DNA binding and transcription activation. Curr. Opin. Struct. Biol. 14:10.