It’s easiest to run Software Update automatically. That way you don’t have to remember to run it. You can it to run each week if running it each day is too often, but even if it runs each day, you won’t really notice it on automatic. You can also set Software Update to download updates in the background, so you don’t have to wait for each to download. That way, when your prompted to install the updates, they are probably already downloaded.
Software Update is important: Apple is constantly fixing bugs and security holes, and Software Update will install updates that fix problems, like those that effect the stability of your iMac and security updates will fix vulnerabilities. And software Update will also give you new features in the new versions of system software and programs.
Software Update is even more important now that Snow Leopard includes some anti-malware features (and subsequent versions of OS X will continue with those features), and the definitions of malware – their unique signatures – will be updated as needed by Apple via Software Update. The last major update of Snow Leopard (10.6.4) included the signature of some malware that piggybacked on illegal copies of iPhoto, and that update would detect it. See Apple secretly updates Mac malware protection. (I don’t think the term “secret” is warranted in the blog post; antivirus and anti-malware programs get updated frequently, and I doubt many people read the descriptions and just trust the software makers to do their job.)