[Defy General] K3n H1mur4:
If you set governor to "ondemand", with a reasonable up threshold, you'll be able to play any game (that is playable on Defy) without problems, and it'll return to the usual clock after you close the game. Just to beat a dead horse, I set my governor to "performance" before opening an app that I know will use lots of processing.

In case you don't know:

Governor = the conditions under which SetVSel will work. "ondemand", i.e., will raise the CPU clock only when it reaches a certain use (see up threshold right after the break). "Performance" will keep the clock at its maximum value (VSel 3) the whole time, it's useful, i.e., for benchmarking. Some overclocking/undervolting apps have a "battery saver" governor, also, but, IMO, SetVSel's options for battery saving are more effective.

Up threshold: It's a simple concept: how much of the CPU should be used before the clock is raised. In example: if you set this to 80%, and your clocks are always double (I used 300/600/1200 for a long time), when the CPU load reaches 80%, it'll be bumped to the next clock option (so, if you're using 80% of 600 MHz, it'll jump to 1200 MHz and, than, the CPU load will be 40%). If up threshold is set too high, you'll experience long periods of heavy CPU usage before it jumps to the next available clock. If it's set too low, CPU clock will rise for almost any reason, and battery usage will go up. I think a down threshold option should be available, too, but it's not (so, the CPU usage % needed for the system to downclock the processor is unknown - at least for me - and defined by the creator of the app).

The red notification icon may be:

1) High CPU clock (VSel 3) being used, if your notification icon is set to "Ginger" (which is a graph showing which VSel you're using: empty means VSel 1, full means VSel 3, the middle steps show many "paths" the overclocking takes to reach each VSel) or;

2) Low battery indication, if you set the app to mess around with up threshold and max VSel allowed when the battery reaches a certain %

About 700 MHz: I don't know exactly. I think it's because people rather use multiples of 200 (or 300, at most) to set their VSels. Also, since nobody uses this setting, there are no reports of safe VSels for it (but obviously it's somewhere between the lowest stable VSel for 600 MHz and the lowest stable VSel for 800 MHz). There are 2 people who use SetVSel: the ones who want to overclock (no matter how much, if 900, 1000, 1200 or 1350 MHz - this last one being reported as the highest clock one can reach without frying the CPU with high voltage/temperature), and the ones who want to undervolt (battery saving addicteds). Since Defy has a good performance even with the default clock, only people who want an superhuman user experience overclock it above 1 GHz. So, the most common clock settings are these:

300/600/800 for undervolters (with various reported VSel values);

300/600/1000 for usual overclockers;

300/600 (or 800)/1200 for hardcore overclockers;

300/800/1300 (or 1350, if you are ACTUALLY insane) for people without any love for their phones.

You can see that 700 MHz isn't on any list, simply because people don't try it at all. If you think 700 MHz fits your needs as VSel 2, feel free to try it (and share your safe VSel for this frequency with us :D). I do not recommend using it as maximum VSel, because setting the CPU below its original clock the whole time may damage the processor AND give you a crappy user experience.

I, personally, use this last setting (VSel 3 @ 1300), but most of the time I use it on VSel 2 (3 only for benchmarking/gaming or when some app is experiencing a CPU leak; 1 only while screen is off or battery below 20%). So, I can get the same experience I have with a stock clocked Defy (without overclocking/undervolting apps, the CPU runs at 800 MHz the whole time) - which, together with CM7 (faster than any stock ROM), is simply great.

If you're having issues (lags or frameskipping) while gaming with the 1000 MHz frequency, try setting the clocks to 300/800/1200 (1300 is quite unsafe because of high voltage, 1350 is insanity). You can find safe VSels for these frequencies many times in this thread.