> It seems like the effects are a lot smoother on my G1 but latency is noticeably higher. After the upgrade I actually spend MORE time waiting for the home screen to appear (dang this handset is feeling old).
I feel your pain!
Did already try going to "Settings -> Spare Parts", and
1. enabled Compcache compressing.
**2** setting "Launcher in memory"
Your phone will be even more memory starved (sorry!), but you won't spend 2-3 seconds waiting *every* time you return to the home screen.