"It is definitely a significant performance issue in SQL Server 2008 to have a large number of virtual log files in a transaction log. Moreover, the test results show that the problem can be felt by common SQL operations such as insert, update, and delete in large batch processes."
From Linchi Shea's SQL Server blog: http://sqlblog.com/blogs/linchi_shea/archive/2009/02/09/performance-impact-a-large-number-of-virtual-log-files-part-i.aspx
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