What is the advantage of running a 16lb flywheel, vs typical 30+lb? WIll the motor rpm quicker?

It will not 'store' energy like a heavier flywheel. It will excelerate and de-celerate much quicker to that of a heavier wheel. Its great for quick, positive up/down shifting but doesnt 'come out' of the hole like a heavier wheel either. So it is more geared for a autocross/road race chassis.....for the most part.

I do know of some lighter chassis in drag racing that utilize lighter wheel's but not very many.