The folks at Anandtech published a video showing the performance improvements of the operating system that was running on a Samsung Taylor and the speed increase was significant. Games loaded almost instantly on the updated OS while the same games took awhile to load on the old version of WP7.
Apparently the speed increase comes from the way the OS has been optimized to handle memory access. In the video, copy and paste was also mentioned as a feature in the update, with the rest of the changes being minor ones. Looks like WP7 users are in for a treat when Microsoft pushes out the update.
Hit the break to watch a video of the updated phone in action: