lag = slow, slowpoke, sluggish

fix = medicine, cure,

in layman term...lagfix will make your phone fast..responsive....  

Basically for Android, you need to Root to gain administrative access of the phone (viewing system folders, accessing system operationes etc.) and access paid market. No need Root to Ahem.

Lagfix is for SGS only coz of Samsung proprietary file system (RFS) which will lag the phone after months of usage or when it reach certain size of storage space (subjective, no specific size).

If you're running Custom ROM of Android version 2.2.1 and above, you can survive without the lagfix. Only applicable for 2.2 and below.

All custom kernel for SGS have lagfix options. Its up to user whether to activate the fix.

google pinyin, can get from market