Lateral stiffness definitely matters for a number of reasons, just not in the way being touted on this thread in relation to power being "lost" through frame flex. The frame loading is relatively low (human power is feeble) and the hysteresis losses in flexing the BB and chainstays are tiny in absolute terms before even comparing differences between various frames. Frame stiffness is all about handling response, stability and comfort. The main parameters in play here are lateral stiffness, vertical stiffness and torsional stiffness. You can definitely make a frame too stiff vertically (harsh riding), the other two are more debatable, but stiffer is generally better unless you make it excessively heavy.