I've never used it myself (so all this is theoretical), but it appears that the only traffic you route through it is DNS.

So all your bulk data transfer (HTTP, etc.) would go at the normal speeds.

DNS itself doesn't involve a lot of work for the server to do. It's a pretty simple protocol / system that doesn't require powerful hardware. So assuming their blacklisting implementation doesn't bog things down, it should be able to serve DNS requests at the normal speeds. In some cases, it could actually speed up DNS because you'd have a local caching server which you might not otherwise have.

The Pi isn't the router, it's just a DNS server / lookup. No data actually flows through it.

no, it doesn't do deep packet inspection. it just blocks DNS queries. So when your webpage says "show the java script ad at xxx.yyy" the DNS is sent to PiHole, which sees xxx.yyy as a spam domain, then instead of resolving that IP, it says "oh, you want to load spam.js from xxx.yyy? Here it is: {}". It actually makes pages run faster.

No, the Pi is only serving DNS and acting as an empty endpoint which ads are redirected to.