If you read this:
"Adding to the improved virtuosity of the images captured by the EOS
40D SLR is the camera's 14-bit Analog-to-Digital (A/D) conversion
process. Able to recognize 16,384 colors per channel (four times the
number of colors recognized by the EOS 30D SLR's 12-bit conversion
capability), the EOS 40D camera is able to produce images with finer
and more accurate gradations of tones and colors."
The obvious impact of not having it means fewer gradations, which
means bigger jumps between gradations, This will be perceived as
banding.
In case I am not being obvious enough. I think this is pure marketing
all the way. Like when the Sony Cybershots with micro sensors had
14bit ADCs, or when Pentax went to a 22bit ADC. Or even when the
Canon G series went from 10bit to 12bit when those tiny sensors don't
really have the S/N to support even 12bit, let alone the 14bit that
Sony was using on the Cybershots.
There is a slight possibility that this will make an infinitesimal
difference on 1Dmk3 with it's fat sensitive low noise pixels. None at
all that it will make a difference with the 40d.
But it is certainly paying off in increased tongue wagging for Canon.