Using Android Guys' link to upgrade to Cupcake, Android 1.5, I've upgraded my G1 and I'm currently in the process of going through and checking out for myself how much better it'll be.
So far, I'm not seeing the G1 operating faster but it'll take more time.
I'll be updating via Twidroid (Twitter name: paul_onxo) in the G1. For you who aren't willing to waiting for T-Mobile, give it a try. It's actually quite simple to do.
Link: Android Guys