It's a faster webserver that uses less memory, but I had troubles getting ssl working with it the first time around.
What happens during the slow downs is that so many people are hitting the server at once, there isn't enough memory to hold the processes handling each request. Things start passing to disk, the site slows down, which means more requests get thrown into the queue... etc.
And then the server basically dies under load.
RC2 helped... but for some reason more people decided to use it. >_>