@charliemort – unsprung mass is the mass (or weight) that is not supported (or above) the suspension, so your suspension fork lower legs, disc brake caliper, wheels etc are un-sprung, the frame and the rider are sprung. Reducing the un-sprung mass means that the suspenion works more effectively as it less mass must be moved during responses to terrain and rider input.
@ctznsmith – that view can only be true if other factors are taken into account, i.e. it is much easier/cheaper for the average rider to lose 10lb from their own weight than the bike, and in some cases (wheels/tyres) the mass lost has a greater effect on speed than losing body mass.
As far as rider / bike weight goes, the bike is easier to move in all aspects (uphill or in the air) if the mass is lower, but so is the rider – if you compare the 150lb rider on a 20lb bike to the 140lb rider on the 30lb bike, I'd say that the two would be as quick IF their power outputs remained identical (not considering different rotational mass etc).
On a decent bike, after a decent set of wheels there is little point in spending big money on weight reduction unless the rider has a decent power output, strength and realistically low body amounts of body fat.
kingtrout is on the money – overall weight is far more important (assuming similar power output).