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I have not personally experienced the problem you described with Outlook 2003 running in cache mode. When cache mode is running, the item is being opened from cache rather then being retrieved from the server. In this case, the response times tend to be very fast, even for encrypted items.
Technically, the fact that you will be decrypting the e-mail with your private key and encrypted mail with someone else's public key causes it to take a little longer. But 28 seconds longer doesn't sound reasonable. Monitor the performance of your processor and other system resources while you are opening or sending an encrypted item to see if there is a bottleneck there.
There are some documented issues the S/MIME control for Outlook Web Access running on a Windows XP Pro machine with SP2. See Description of the known issues with using Outlook Web Access on a Windows XP SP2-based computer.
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Related information from SearchExchange.com:
Learning Guide: Exchange Server Performance
Reference Center: Exchange performance
Reference Center: Message encryption
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