Is it smart to turn off real time protection for Microsoft Security Essentials on Server 2008? Will this help with performance? I have it running a scan every night.
Yes, turning off real-time protection in your AV solution will improve performance (as it will no longer scan every file that's accessed). Whether it will improve performance noticeably or not simply depends on too many environment-specific factors to answer.
As to whether it's smart or not, again, that depends. With the exception of terminal services/remote desktop services servers, you shouldn't have users logging on to your servers, or be using them in any way that it's possible to get a virus on them (like by browsing the web). Assuming those rules are followed, it's generally considered safe enough to just run periodic scans on your serves, and not have real-time protection enabled.
That's how I've always handled it where I've had a choice. Terminal servers get the full AV treatment, same as clients, other serves just get periodic scans.