I've been using a Ram disk as the TEMP folder on Windows for more than a year and the overall speed of the system is quite better than without it, and certainly quite less disk activity. You can change the temp folder location in the enviroment settings.

The advantages besides speed are, the temp folder cleans up every time you restart, it's also useful for storing anything disposable, an archive you'll need to download only once and use its contents, and useful for doing anything potentially unsafe for your regular disk.

The disadvantage for setting your temp folder to the ram disk is that sometimes, some programs will try to store a lot of data on the temp folder and fill it up (I use 384mb), but that's something you can usually change in the programs' settings.