The answer lies in how Halo 3 loads map data. Each map is cached onto a certain part of the HDD that is reserved for game use. Once the game is installed on the HDD, it has to read the data on one part of the drive and write it to the reserved section. While data can be read from the DVD at the same time the HDD is writing data, the HDD can't read and write at the same time. As such, loading from the HDD takes significantly longer. Bungie advises gamers not to install the game, especially if you play online, as all other players will have to wait the extra time it takes to load and cache each map.
[Via Evil Avatar]