|"explain why faster RAM is important"|
Faster than what? The answer is a lot more complex than you may think. Diiferent CPUs have different memory requirements. Most CPU/RAM configurations have a ratio that should be maintained to provide optimal performance. This ratio is based on the CPU frequency. All CPUs prior to the P4 performed best with a ratio of 1:1, that means with the CPU frequency at 100MHz, the RAM frequency should also be 100MHz. This ensured that both the CPU & RAM bandwidths were in balance.
The ratio requirement changed for the P4 due to the inefficiency of the netburst architecture. The optimal ratios for the P4 are 3:4 for 100MHz or 200MHz frequency or 4:5 for 133MHz frequency. Dual channel mode was also introduced with the P4 to allow the memory bandwidth to keep up with the increased bandwidth of the quad-pumped of FSB.
The Athlon 64 architecture changed the need for a ratio altogether because the FSB was eliminated. With all AMD A64 systems (& newer), the memory should be run in dual channel mode & as fast as possible.
The Core 2 Duo/Core 2 Quad performs best with a ratio of either 1:1 or 1:2, depending on the capabilities of the system.
The latest CPU released from Intel is the Core-i series. This series has also eliminated the FSB so like AMD systems, the memory should be run as fast as possible. The Core-i also introduced triple channel memory.
As OtheHill stated, in some cases it's better to have fast RAM & then underclock it so that the latency setting can be lowered. Let's say you have an old Athlon XP that runs at 133MHz frequency (266MHz FSB) & you install DDR400 RAM which runs at 200MHz frequency & has a latency of 3.0. You know that the optimal ratio is 1:1, so you should lower the RAM frequency to 133MHz (DDR266) to match the CPU. By doing so, you *should* be able to lower the latency to 2.0.
Does any of that make sense?