There seems to be almost no correlation to performance - 5 bars could be a 100+ Mbps connection, or it could be < 5 Mbps... On the other hand, 4, 3, 2, and 1 bars all mean that the connection is going to be flaky and unstable
The bars show signal strength which has no direct relationship with performance. But a weak signal is usually of poor quality and even a strong one may also be and that will effect performance. Signal quality is more difficult to quantify so is not shown.
The signal strength is a combination of the actual 802.11x signal + Phone + Microwaves + other sources that might generate 2.4GHz “Noise” + Brain emissions of the user’s anxiety state (j/k), in other words it is visual representation of all the 2.4GHz in the atmosphere around the your Wireless hardware.
I.e. you might see High Signal Strength that Shows: Excellent (5 bars), but it is actually 30% signal + 70% noise.
Such a signal would be the reason for low bandwidth, and or frequent disconnection of the Wireless Network.
In contrast, a medium level Signal (3 Bars) that does not contains any noise would provide a match better connection. Netstumbler is a free windows tool to see the signal to noise ratio.
If your router is not supported by Netstumbler, then try Kitz - DMT Tool