Memory timings have a bit of importance in performance, but it seems the general consensus is that they make the benchmarks better but you won't really notice the difference between 4-4-4 and 3-4-3.
Memory timings are the delays (measured in clock cycles, not time) between the steps that your memory goes through. I don't know exactly what those are, but the simple version is that it's how long the memory takes to respond to requests.
Some people dump $400 so they can run memory at 1150mhz and 3-4-3 timings, but honestly you can buy memory for half that price and still hit speeds and timings near those (say 1066mhz at 4-4-5 timings) and you probably won't notice a difference in your computer without using some kind of benchmark. Today's computers really aren't all that sensitive to system bandwidth or latency changes (latencies are a shorter term for memory timings).
Like I said, latencies are measured in clock cycles, not time. So basically, DDR2-800 memory with 4-4-4 timings responds exactly as quickly as DDR-400 memory with 2-2-2 timings. That's because the DDR2 is runninng at twice the speed of the DDR, so it gets in twice as many clock cycles in the same period of time.
If you want more info, check the memory section of anandtech, or if you really want the lowdown, head over to the highly technical area here at AT.