Hi,
Increasing the frequency of the CPU in the PC makes the CPU go faster. That means that once it gets a set of instructions to perform, it can perform them faster. That's overclocking the CPU. However, it has to interface with the RAM memory so if the RAM isnt faster too then the CPU will have to waste more clock cycles waiting for the use of the memory. You can also try to overclock your RAM to keep up with the CPU.
One of the main limiting factors today is the heat generation. The faster the CPU is clocked, the more heat it generates. This is partly because of the capacitance and partly because we have to increase the core voltage to get a serious increase in speed. If you are not serious about overclocking then it wont be worth bothering with because you wont want to invest in better heat sinking for the CPU, which could potentially allow you to overclock much more.
Increasing the frequency of the microcontroller however can have a much more profound effect because it has it's own internal memory that goes as fast as the controller chip. That's if the chip allows it. The chip will use more power however unless it is in standby or sleep.
One thing that is often overlooked in today's discussions is *under clocking*. Under clocking allows you to run the PC CPU at a lower frequency then originally designed for. This not only means MUCH less heat in the CPU, it also means a lower electric bill. There's also the possibility of shutting down some of the cores and only allowing those cores that are needed to run either at full speed or reduced speed. For example my old 4 core CPU used something like 95 watts when it was running all 4 cores at top speed, but only 25 watts or less when only one core was being used. That's 1/4 the power. My newer 8 core CPU uses only 35 watts at reduced speed when im typing or doing other stuff that doesnt required super fast CPU access. If i had to use it full throttle all the time it would use almost 200 watts, and this almost never happens except for a few seconds. The drawback to high speed and multiple cores is the required heat pipe heat sink, and would probably do better with a water cooled.
So the speed can be increased and the more you cool the CPU the faster you can run it, to a point. Of course more cores also uses more power and thus more heat, so shutting down some of the cores is also a good idea when the full power of the CPU is not needed.