I run the plugin on a site with 124 lines of addresses. Initial server response from the site was gradually getting slower and slower and recently reached the pain threshhold. By initial response, I mean waiting for the F.O. login screen when not logged in as an administrator, waiting for a site page or waiting for a WP dashboard page when already logged in as an administrator. After this initial wait, subsequent pages would load promptly.
Disabling Friends Only would remove the initial delay.
I subsequently found that initial response time greatly improved when I changed the server’s PHP mode from 5.2.x FastCGI to 5.3.x FastCGI.
In response to my own earlier forum post (unanswered, now closed to further comments), I recently figured out that Friends Only is compatible with the caching plugin W3 Total Cache (current version 0.9.2.8).
Despite all this, initial response time still seems to bog down at times. Obviously, it could be my server at fault…