It depends on your needs:
- Do you want to conserve battery? Then underclock the CPU
- Do you want better performance? Then overclock the CPU
Typically there are different kernels that you can flash for your device. Different kernels offer different clockspeeds. Some of them will also under volt your phone to consume less power. The disadvantage of undervolting is that the phone may not be able to run faster clockspeeds.
Additionally, your phone may not overclock to the same speed as another phone due to one processor being physically different than another processor (no two processors are made 100% exactly alike. When overclocking you are stepping beyond the bounds and specifications that your phone was designed to run at). What will happen is your phone will enter a boot loop if it is unable to run the kernel at a specific speed (you'll have to flash a new kernel or revert to a previous Nandroid backup).
I don't know of specific kernels for the G1, but for example there is a set of kernels by ChevyNo1 for the Droid1. The general steps are:
- RUN A NANDROID BACKUP
- Choose a voltage: ultra low, low, or normal
- Start with the kernel with the lowest overclocked speed
- Flash that kernel.
- Use SetCPU to set the clock speed to the max.
- If the phone remains stable, then choose the next kernel with the same voltage with a slightly faster clockspeed and try to run it at its max speed.
- If the phone does not remain stable, then revert to your last Nandroid backup or the last kernel that ran stable on your phone