1. When dynamic power management mode is enabled, it puts SDRAM devices into power-down mode when there is no ongoing memory activity by negating CKE signal. Details of 'power-down mode' can be found in SDRAM datasheets.
When the memory exits from the power-down mode, it requires some time delay (tXP) before any bus command (like read/write), so yes, this mode slightly affects performance.
2. To enable dynamic power management mode the user should set bit DDR_SDRAM_CFG[DYN_PWR]. This can be done any time, for example before the DDR controller is enabled.
Regards,
Bulat