It really depends on the phone itself.
Some run stable at 1.1GHz, most (mine included) seem to runs table at 1GHz, some can't be overclocked over 800MHz.
To overclock, you need an OC kernel flashed. Once the kernel is flashed, you can use a program (like SetCPU to change the frequency or if you are using Cyanogen/LiquidNext, do it in the settings menu).
Ritchen made a bunch which work on stock ROMs and Acer-based ROMs, not sure where it is but I am sure you can find it through a search (also most custom ROMs have it included. I recommend LiquidNext as it is Gingerbread with all hardware working and fairly stable, worth checking out in my opinion).
Prior to overclocking, I recommend that you have a Nandroid backup at your current clock speed (incase your phone is unstable or unable to boot so you can easily revert to regular speed).
Hope that helps.