4x4,
ECT will probably give you 0.00000001 second advantage in acceleration!

Well, actually, it only functions to hold a gear a bit longer before upshifting (aka slightly more aggressive shifting). By doing so, you may see a slight decrease in fuel economy. That's about it. You can use it whenever you want. It does not affect anything else. Some owners have it on all the time. For me, i don't ever use it...it's not like i will win many races these days with other SUVs.
Your automatic transmission has 4 forward gears (and 1 reverse gear). The first three gears are NON-overdrive gears, used mainly to get you going...that is, it has ratios of > 1. Here are the gear ratios for your 4runner:
1st 2.804
2nd 1.531
3rd 1.000
4th 0.705 <---- Overdrive gear!
Reverse 2.393
For example, your first gear ratio is 2.804, which is > 1 (as is gear #2 and #3). The 4th gear ratio is 0.705, which is < 1. This is your overdrive gear, used to conserve fuel economy, smoother crusing, and decrease stress on powertrain.
Your automatic transmission will shift into OD (overdrive) whenever you're cruising (at most speeds) to decrease engine noise, conserve fuel, and decrease wear on powertrain. However, in OD, you won't be able to accelerate very well because it's main function is to conserve fuel, not acceleration. When you press harder on the gas pedal, your tranny will downshift out of overdrive to one of the first three gears (usually down to 3rd gear) to provide more spritely acceleration. Once you've relaxed your foot from the gas pedal, it will shift back into OD.
The OD button is to keep the tranny from shifting into 4th gear (OD gear). This is useful in off-roading where you may not want the engine to shift into OD, such as going across rough terrain in 4-HI (you will not likely go into OD when in 4-LO because speed will be too slow). By doing so, you won't have any lag time when you accelerate. Why lag time? Well, same as above, in OD, your engine is "relaxing...shooting the breeze". Therefore, it is lazy during this time to accelerate. To get it up and going, you have to press hard on the gas pedal to force a downshift OR press the OD button.
Another common place to lock out OD is during heavy traffic. This will prevent your 4runner from shifting into and out of OD...basically, by locking out OD, you decrease shifting activity by allowing the tranny to only use the first three gears. Less stress on your tranny by doing this?? I don't know since Toyota tranny is so darn reliable and bulletproof.
Hope this helps.
BTW, OD gearing (< 1.0 ratio) is usually the 5th gear on a 5-speed manual transmission. In the new 4Runner (2003), the OD gear is the 5th gear on the new 5-speed auto tranny.