Disclaimer: I've never used AS/ASII, but just made a purchase of some. Should be coming shortly. I've always used Radio Shack compound.
The benefits from Arctic Silver and Arctic Silver II come when you intend to overclock your chip. If you intend on running your chip at stock speed - like I do for my dual processor - then there is no reason to invest in 1) a heavy duty heatsink and 2) expensive thermal compound. Similar to the comparison of Hyundai vs Honda, if you just need a car to get you around, I'm sure you don't care if you have a Hyundai that can be had for 2/3 less than a Honda. However, if you care about appearances, about acceleration speed, and the interior trim options, then go for the Honda. It'll cost you more, but might satisfy your higher standards.
I have been happily using Radio Shack compound for a while now, and when I used my fat Alpha heatsink on my Slot 1 P3-1 Ghz (before I moved to dual processors) it _always_ kept the CPU temp at anywhere from 26-30 degrees C. And during those cool winter nights, it would drop down to about 14 degrees C. Crazy, eh?
Now I'm using two Golden Orbs, with Radio Shack thermal greases, which keep the chips at about 50 degrees C, still 20 degrees below Intel's limit for the 1Ghz chips. Still acceptable; I'm not overclocking, and I've seen no problems whatsoever. The problems I have now are with my video card (Quadro 2 Pro) which for some reason cannot even maintain the stock core speed of 250mhz. As soon as I drop it down to 248mhz it's happy. Weird. So I bought a Blue Orb and some AS II to hopefully cool it down a bit more.
We'll see how effective it is.