Technically an International Driving License is valid under Article 45 of the new driving laws but do not expect one of the traffic police "tubbies" standing at the side of the road to know the law. It is legal to drive/ride with your headlights on during the day but expect to pay a donation for the priviledge
The police started to enforce the new driving laws at the beginning of the year (having been passed by parliament some 8 months previously) but it caught everybody by surprise so they all posted on the big boss's facebook pag. He of course being a man of the people (and just about to fly in his private jet to Singapore for his annual medical check up) said it was ridiculous and that anybody could ride a 125. To prove this he posted a photo of him riding a Honda dream (100 metres to his motorcade) with his consort pillion both without helmets. Of course technically he could not get a driving license as he would not pass the medical as he only has one eye. But who worries about technicalities when you are the big boss.
So a couple of Ministers and the National road Safety executive got together the next week and decided that despite the 2,200 deaths and 8,000 Serious hospitalisation injuries per year than it was not necessary to have a license for a 125. Enforcement of the laws were also delayed by an additional month until sometime in February.
Above that you will need a big bike license (A2) but be careful as most places that get you that license will only give you and A1 license (below 125). So insist on a big bike license before handing over any cash.
Reality is slightly different. If you are stopped you will have to donate. The donation is more because you are not Cambodian and it will be multiplied by the number of tubbies resting at the side of the road.
The tubbies are not really a problem but the road blocks are more difficult as they will not take a donation and want to see the paperwork and are supported by the Royal Gendarmier (dunno how to spell) with things that go bang and leave a hole in your body.
NEVER hand over your license. Show it but do not give it to them. I NEVER carry my registration documents with me and there has never been a problem.
In reality as a westerner you are unlikely to be stopped unless you have done something wrong (except the lights). Just be pleasant and laugh and joke with them. They are quite nice people really who get paid around $120 per month and you will be on your way quickly albeit a bit lighter
Your insurance is a different issue as that follows western rules....
Oh, and finally they are starting night road blocks to catch drunk drivers. But I avoid riding at night because it is too dangerous (lights and sobriety are optional).