You can run the hdd on that system, but it will only perform at the SATA2 speed.
Yes, there is a difference between a 5400 and 7200 RPM hdd.
The following information is quoted from Yahoo Answers. This pretty well sums up the differences between the two types.
"The rotational speed has two effects.
First, it determines how long it takes the drive to read each track when it's reading a large amount of sequential information. A 5400RPM drive will need to spend a bit more time waiting for each track to do a full rotation than a 7200RPM drive will.
Second, it determines how long it takes for the correct part of a track to come around to the head when the computer only wants to read a small piece of information. On average, the drive will have wait half a rotation before the correct chunk of data rotates under the head when it only wants a small chunk.
The first effect is mixed with other effects. For example, a drive that spins slower may be able to pack data a bit more tightly. As a result, it may store more data on each track. So even if it takes it longer to read a track, the read rate may be the same or higher. So the sustained read throughput is more important than the rotation rate for considering this effect.
However, the second effect can be significant. When a large number of small bits of information are needed, a significant amount of the time it takes to read all the chunks will be the time spent waiting for the drive to spin. However, another factor will be the time it takes to move the head from track-to-track and wait for it to stop vibrating so that it's steady enough to read. A drive that spins slower, but can move the head faster, may read small chunks faster than a drive that spins faster. So the random read throughput is more important than the rotation rate for considering this effect.
So the short answer is that you shouldn't consider the RPM rate directly, because it only matters in ways that mix it with other factors. You should look at the random read, sequential read, random write, and sequential write speeds. Sequential read is typically the most important. Random read and sequential write are usually second-most important."
Edited by dc3, 16 March 2014 - 02:22 PM.