If you get one in the 1 1/2 lbs range the bike will spin up quicker. If you go too light like the 8 oz flywheel I think you sacrifice the idle for the bikes ability to rev quicker. Less rotating mass is better, but for a good reliable street bike you need a bit of mass.
I have the Nichols 8oz flywheel, along with a lightweight clutch basket and lightened crank, with nary an idle problem. The bike idles without a problem and is smooth (I had the bottom end balanced, which probably helps). There is a downside though, which is starting from a stop.....since there is so little stored energy in the light flywheel, the engine will die if you don't give it enough gas from a start. If your bike does commuter type duty, I would suggest having the flywheel machined a little instead of dropping a few pounds with a new flywheel.
Lighter flywheel is not better on all circumstances. For example here in Finland one of our Ducati club member is racing on 996F (ex Ben Bostrom bike i believe?). He has nowadays 998F frame and all kinds of nice bits on his superbike.
He thinks that on slow tracks like all tracks in Finland are, heavier flywheel lets the rider to control throttle better on very slow curves.
I have noticed the same thing also even though I have 749. If your bike is mainly used on local roads then I believe you can buy a lighter flywheel just for fun.