Well, learning how to play in time/speed is extremely important. That's one of the first things people will notice in your playing if your timing is off. To me it will sound just as bad as hitting a wrong note.

A lot of it has to do with anticipation. If people can sense what your playing and can anticipate your speed and when your going to change chords, and "feel" what is about to come and you mess up the timing, it will completely turn them off because you didnt nail the chord change at the exact moment they expected it. Make sense?

As for practicing; I have read/listened to countless interviews of famous musicians. Not to discourage you, but you wouldnt believe how many end up saying roughly the same thing, that they would play a minimum of 6-8 hours almost every day. I have read some where they even went so far as to say they felt like it was a chore rather than a hobby.

So as to how much you "should" practice, it all matters on what you want to gain from the guitar. If your just a casual player, 1-2 hours a day is good. If you want to master it, well, start playing 10 hours a day! :p