1) Adding a tooth changes the final drive ratio to slightly higher gearing. Yes, it does add top end speed as rpms are the limiting factor.
2) You didn't mention what bike you have. A SM with a 16T or an America with a 17T, or a newer model with an 18T. If you have a Speedmaster (pre 2006) then going up to a 17 would be absolutely no problem. You might can go to an 18 (from a 16 or 17) if you don't mind starting off a little slower. Opening up the exhaust and re-jeting along with opening up the airbox will result in a noticeable increase in hp making it easier to start off with the higher gearing.
