It is safe to overclock. If you go too high, the unit will just shut off and when you turn it back on, the clock will be back to 200MHz. You should be able to get to at least 266MHz; most people get 270-280MHz; and a few get close to 300MHz. It is a good idea to increment slowly (i.e. try at 5-10 MHz intervals) to find out the limit of your unit. Sometimes it may work for a while at a certain frequency, but it will be more unstable.
Everything won't run twice the speed. A given percentage increase in the clockspeed won't neccessarily correspond to the same percentage performance increase.
The CPU-LCD Tweak application is also nice because you can reduce the scanlines and other LCD artifacts by playing with the LCD settings until it is to your liking. I find the UPLL clock source at 2 to be to my liking.
I run CPU-LCD tweak almost everytime I power the unit, but I have only overclocked a couple of times. I regularly underclock for reading ebooks or viewing pictures.