I've found in B3D that secondary textures are very quick. However I had problems on my last card (GeForce 2 GTS) when I used a 3rd texture layer as the card natively only supported 2 layers (but 8 according to the drivers... hense problems.
There should be no speed hit for multi-texturing as long as your GFX card has enough texture units. The GeForce 2 does indeed only have 2 texture units so Blitz3D emulates when using more texture layers by duplicating meshes/textures which certainly does have a speed hit. GFX drivers often lie about their capabilities, it seems.