Will a remote X-Windows session run faster if I install a better video card in the remote server?

X should be fast enough on a LAN so your problem may be elsewhere. However, you could try to X acceleration software such as NX or VNC.

Short answer, No, X is a brain dead protocol. Why X isn't dead by now is astonishing. (I had high hopes for display postscript but that went nowhere...). In X-windows the "Server" is your Mac. The client is the application you are running. X tells your Mac what to render and the Mac does all the work on drawing the screen. At best it's possible that should it be possible to get a better card for your Mac, you might increase performance- but not by much. X "accelerators" like NX work by compressing and caching X calls (essentially replacing X with a better protocol)

See http://www.miscdebris.net/blog/2007/06/01/speed-up-ssh-x11-forwarding/ and copied below for a really useful tip on how to speed up X11 forwarding. It made a huge difference for me, even over our 100-Mbit LAN.

Speed up SSH X11 forwarding Posted June 1st @ 9:50 by Werner

I use an Ubuntu server as a work-horse for my calculations and connect from my desktop-pc with ssh to the server. For some applications (gnuplot =) this is really slow altough it’s over LAN. I found on the internet some instructions to improve this situation: instead of the AES cipher the arcfour and blowfish ciphers perform much better and switching on compression also doesn’t hurt. Therefore one should use

ssh -c arcfour,blowfish-cbc -XC host.com

to connect to with ssh. And guess what? This really improves the situation, especially for gnuplot. Thanks Samat!