Why FIFO is important in camera?
Its not FIFO that is the issue, its the FIFO Buffer that you need with an Arduino.  The Arduino can't download the data from the camera at the same speed as the camera can send it.  Adding this extra buffer in lets the camera generate the data and the Arduino download it (in the same order that it was generated) at its own pace.  

You might not need the FIFO buffer for faster microprocessors, but you do need it for the Arduinos.  You could get your own buffer and rig that up, but for a few extra bucks let them do it for you.