Ignition Timing101.
On a gasoline 4-stroke engine the 4 strokes (oddly enough) are intake, compression, combustion or ignition, and exhaustion. Diesels have the same 4 strokes but the ignition system is different. So we will ignore that.
1st stroke: intake
The air/fuel mixture is drawn into the cylinder by the opening of an intake value and the vacuum created by the piston descending toward the crank case.
2nd stroke: compression
The air/fuel mixture is compressed back up to the top of the cylinder and into the combustion chamber.
3rd stroke: combustion or ignition
This is the crucial step in engine timing. The spark plug is lit off and it ignites the air/fuel mixture. The explosion pushes the piston back down. This is the motion that actually causes rotation of the crankshaft. Which translates into momentum.
4th stroke: exhauation
At this point the exhaust valve opens and the force of the piston coming back up pushes the leftover gasses from the combustion out to the exhaust system. The exhaust valve closes, and the whole cycle starts all over again.
In reference to your question about timing we need to take a closer look at the time between the 2nd and 3rd stroke.
The point in time where the spark plug is energized is crucial to the operation of the engine. This point is known as the ignition timing. Ignition timing is measured in "degrees to top dead center" or DTDC. Top dead center is the highest point that the piston travels in the cylinder. The degree portion refers to the rotational motion of the crankshaft. Which is constantly moving in a 360° pattern. So a typical timing reading might be 10° before TDC or 10 DTDC. (I have no clue what the timing should be on the VG or VQ engines off the top of my head) you always want to be before TDC because the explosion takes time and you want to get the most out of it pushing the piston back down.
So the idea is to energize the spark plug at exactly the right moment that all the valves are closed and you get a "clean" and "powerful" burn.
If the spark plug is energized too soon in the travel of the piston, the air/fuel mixture is not compressed enough for "clean" or "powerful" combustion. This often makes the engine not run. Or run VERY poorly. As the explosion happens while the piston is still being pushed up by the crankshaft.
Too late, and the mixture has passed through its ideal detonation point and the piston is already traveling down without the aid of the explosion. So you've lost HP there. And the engine also runs poorly.
Plus the added problem that the intake and exhaust valves might not be fully closed when the explosion occurs. Meaning that some of the power leaks out of the cylinder and can cause other issues.
Unfortunately "clean" and "powerful" don't coincide.
Because of this discrepancy, manufacturers always err on the "clean" side of things. They set the timing so that the most amount of the air/fuel mixture is consumed at the time of ignition therefore reducing the leftovers that get pushed out into the exhaust.
What that means for you and your programmer is that advancing the timing a few degrees can often correlate to a more "powerful" explosion because the mixture is slightly more compressed (equating to more HP), albeit the burn is not quite as "clean."
This is one of the oldest tricks in the book. In the old days it used to be done by rotating the distributor which changed the point at which the spark plugs energized. Now that everything is computerized the tuner/programmer can do it for you.
In answer to your other questions...
I don't know what the timing should be on the engine.
I don't know what gains might be had on the VQ engine by advancing the timing.
The only real adverse effects of a slight timing adjustment will be slightly worse emissions. If you go crazy with it, you can create some serious reliability/horsepower issues.
Typically timing NEEDS to be adjusted when you change things like pistons, heads, valves, cams, etc. As all of these things affect the compression ratio and valve timing of the engine which as we've discussed has a direct correlation with the proper ignition timing.