Will a faster read/write speed on USB drive = faster performance?

As long as you're using USB 2.0, the biggest bottle neck is the speed of the actual drive as they don't come anywhere near hitting USB 2.0's limit. And, compared to a local hard drive (where you usually run apps), flash RAM is SLOW. Read speed is important (for reading DLLs and EXEs and such), but write speed is very important, as apps will be writing bits here and there (like cookies, config changes, etc). So, you need a drive that has fast read and write speeds... and has a fast controller so that an individual read or write is handled quickly. That's why, even a drive that can read or write a large MP3 file quickly may still be slow with portable apps.