Unlike many virtualization programs available for Windows, PearPC does not lock the memory into physical RAM. Basically how this works, is that if you're using VirtualPC, that it will consume a certain amount of physical RAM, and not release it to the OS under any situation. This can generally cause your OS to perform significantly worse, as it no longer has all the memory it's used to, and must page out other memory, even if VirtualPC isn't using a specific piece of memory.
PearPC allocates Virtual Memory, rather than a specific amount of Physical Memory. That means that you can allocate more memory to PearPC than your computer even has. What this allows is for the OS to page memory in and out as it's used or not-used, thus freeing OSX from handling the paging details, and the native OS handling those details for you.
I can't speak for Windows performance, because as I've been using Windows at work, I'm amazed at the poor quality of their paging mechanisms, and how it decides to deal with the working set (the most common pages used) And it's possible that allocating a full 1GiB to PearPC when you only have 1GiB of RAM may decrease performance of PearPC and Windows, although in Linux it most certainly performs better.