I assume the "lag" you're referring to is the system overall, and not the drive. Firewire WOULD likely stop the lag of the system overall, so you wouldn't notice it seem to freeze for a moment when accessing the drive, but the drive may not perform as well (notably, access times might jump, though the actual throughput might stay up fine). The freezeup has happened to me on many different computers with varying components, but not on other computers. This of course only happens when using IDE devices, and happens with IDE hard drives as well when you allow them to spin down and they need to wake up. As far as I can figure out, it's due simply to the fact that IDE devices take control of a bus, and while the drive is spinning up it doesn't let the bus go, and seems to keep the CPU occupied as well. Some drives do it worse than others, so a different brand of drive may solve your problem. I don't build enough computers with different types of drives to have any idea whether there's a pattern to the types of drives, motherboard chipsets, drive PCB chips, et cetera that cause this problem, but I know it doesn't always happen.
Disabling auto-insert notification is just a way of getting around the problem during one instance that it may occur, when the OS reads the CD at insert. It won't make any difference at any other time that the CD has to spin up.
