Question : Problem: Will more memory increase performance on my iMac?

I'm running OS X on an iMac with 256 MB RAM and 80GB Hard Drive.  
I've just started using iPhoto, iMovie, and iDVD.  It seems like the machine is getting slower as I add more files, especially in these applications.  Will getting more RAM improve performance?  

Also - I've read where defragmenting the drive in OS X isn't necessary but have seen some caveats that say if you're writing large video files you may want to defrag.  Am I to understand that if I'm writing lots of video files (both importing from DV, creating movies, and writing DVD's) that I should defrag or that I may defrag but it's not going to make much of a difference in performance anyway?

Answer : Problem: Will more memory increase performance on my iMac?

The terminal is an application in the Applications/Utilities folder that is your unix terminal.

A lot of pageouts is relative.  If you run a lot of applications open all the time, then you will always have more pageouts than someone who only runs one or two apps.  The number will also go up the longer you use your comp.

I personally like to have my pageouts less than10% of my pageins.

You and weed are right in that if you have a damaged disk, more files will be impacted if you defragment.  That is why most defragmentation programs such as Norton Speed disk require you to run a disk utility first, in order to confirm that the drive is fine.  But defragmentation will always help peformance, although it varies depending on the type of fragmentation and to what degree it is fragmented.

IF you have a damaged disk, it is probably a good idea to get that replaced or repaired, as even daily use can lead to files impacted by a damaged disk.