What is the effect of changing the maximum application VM heap size? The settings menu in CM6 lets you change the maximum per-process heap size (internally, that’s the dalvik.vm.heapsize property). What are the practical effects of raising or lowering that setting? On my G1, I changed it to 12m from the default of 16m, and I noticed that switching applications feels faster, but I wonder if it will cause some applications to run out of memory sooner.
Here's a great article someone wrote on the effect of changing it, very detailed: http://ryanolson.wordpress.com/2010/07/13/test-how-changing-the-max-amount-of-memory-per-vm-heap-can-effect-your-rom-cyanogen/

In short, with the G1, it can cause bigger applications to crash. I would just recommend you keep it default or find a value that you do not see any crashes in applications with.

As far as anything else goes, in the short period of time searching else where and reading over different posts. Could not personally find any other effects, other than possibly battery life.