Yes, it will speed up the encoding time that Toast 6 takes to encode the DVD -- but, as Natobasso said, it won't speed up the burning time -- that's dependent on the speed of the DVD burner you have.
Your computer, going from 400MHz to 1GHz, will be roughly twice as fast. If you're serious about DVD/Video editing, get the processor upgrade first, then go back and max out your RAM at 1.5GB (or is it 2GB?).
$210 for a 1GHz upgrade isn't a bad deal at all.