It really only matters in competitive battles. Rare Candies prevent you from gaining EV's as you level up, making your pokemon weaker overall. However, they're pretty useful in-game because you gain EV's throughout the game. Besides, three levels would make nearly no difference. So go ahead and use them, you have nothing to lose.
Effort Value at it's simplest is just an invisible number for each stat on a pokemon that raises based on the pokemon you beat. You gain them at the same time as experience points. It was a system implemented to make "trained" pokemon seem stronger than ones that were just caught at a high level, or rare candied to level 100 (wish I knew about EVs in Red and Blue >.>)
>:I Been off the presig cold-turkey since: 23/7/07