That's not exactly correct.
The problem with the traditional Google XML Sitemaps plugin is that by default it rebuilds the sitemap when you create a new post. Even if you only have a few hundred posts, this creates a noticeable slow down. Of course, the way around this requires that you turn off automatic rebuilding and setup a cron job to rebuild it. Unfortunately this can mean then when a search engine crawls your site, the sitemap might not be fully up-to-date, as the cron job might not have run yet.
I switched to BWP sitemaps a few weeks ago and couldn't be happier, especially since I'm dealing with over 30,000 posts. It gets around the resource-usage problem in two ways. Firstly it allows you to split your sitemap up into smaller sitemaps (as mentioned above), all of which are linked together via a sitemapindex file. When you create a new post, only of of these smaller child sitemaps gets updated (i.e. the one with recent posts in), and this saves alot of CPU power. Secondly when you create a new post, it only pings search engines and doesn't rebuild the sitemap until a spider crawls your site. The benefit of this should be obvious but basically, the rebuild only takes place when it needs too.
As you can probably tell, I am a strong advocate of the BWP plugin and I recommend more people try it out.
N.B. You only add the sitemapindex in Webmaster Tools and Google/Bing does the rest.
