1/4" is a LARGE change. Think about it, it's over 6 mm.
You may have a small decrease in rolling resistance due to a smaller contact patch, but you will have a LARGE decrease in weight.
Weight of the tires, tubes and rims is the most significant weight on your bike, because it's rotating weight with a very large diameter. A couple of hundred grams in your tires will make an enormous difference that you will feel right away.
The question is what tires will fit on your rims without distorting the profile. That's a question for your LBS. I really don't know what's available in 26". Is that the same as 650?
Speed comes from what you put behind you. - Judi Ketteler