Dynamic SQL using parameter markers vs. embedded SQL using host variables

We have a lot of embedded SQL that uses host variables, e.g.:
Select a, b, c from custmast where c = :hostc;

It has been suggested to me that this can cause performance issues because the plan cache may need to be "rebuilt"(?), so we should consider replacing these type of queries with dynamic SQL using parameter markers, e.g.

SQLStatement = 'Select a, b, c from custmast where c = ?';
Exec SQL Prepare P1 from :SQLStatement;
Exec SQL Declare C1 cursor for P1;
Exec SQL Open C1 USING :hostc;

Is anyone aware of a resource that describes this in detail?  Maybe also provide test cases that prove performance gains?  (Or not?)

- Dan Bale
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