I have PostgreSQL 8.4.8 on Ubuntu Linux x64.  Server is a Core i7 950 with 6GB 
of RAM.  2GB of RAM us used by Java, some small amount by the kernel / services 
and the rest is available to PostgreSQL.  Hard drive is a single 7200 RPM SATA 
1TB Caviar Black HDD.  No other applications / processes are running when I 
perform my tests.

I have an application that performs about 80% reads and 20% writes for a 
specific billrun.   It takes about 60 minutes to complete, and I can have it 
perform precisely the same queries repeatedly.  I have consistently showed that 
when shared_buffers = 24MB (the default), and wal_buffers = 64kB, the system 
completes the process in 50 minutes.  When I bump shared_buffers to 1500MB, the 
system slows down and takes 60 minutes to complete the same process.  Changing 
that back to 24MB, but then changing wal_buffers to 16MB has the same impact - 
performance drops from 50 minutes to about 61 minutes.  Changing those two 
parameters back to the defaults returns the time to 50 minutes.

fsync = off for these tests - not sure if it is relevant.  All other settings 
are at their defaults.

Please explain why the system is slower with the recommended values for these 
two settings?  The DB is about 74GB, the largest table has 180 million rows.
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