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A typical hint for tuning Windows 7 performance is to switch off Hibernation. I do understand this will gain me some disk space, but why should it improve the overall performance?

Is there anything beside "more free disk space" improved in terms of performance?

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It doesn't improve runtime performance at all. It can improve sleep/resume times if hybrid sleep is on, but you lose the ability to resume in the event of a power loss (more useful on laptops than desktops).

The downside of hibernation is that the disk space is reserved, because the system needs to make sure enough is there before it tries to hibernate. For systems with large amounts of memory it can be a significant chunk of space, especially if your boot drive is a relatively small SSD.

SSDs are the main reason that you hear about the suggestion to disable hibernation. Not only do you gain back valuable (and expensive) disk space, but such systems often boot fast enough that hibernation doesn't gain you much over a cold boot.

MS has taken steps to reduce hibernation space requirements with Vista and 7, and is continuing those in Windows 8, so expect the disadvantages to lessen. Also, Windows 8 will use hibernation to drastically reduce boot times. You can find more information about that at http://blogs.msdn.com/b/b8/archive/2011/09/08/delivering-fast-boot-times-in-windows-8.aspx

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