Project titles matter because they partially determine who will end up reviewing your proposals. Unlike the situation with journals, where an editor can share the abstract of a manuscript with a potential reviewer, all NSF can share is the title. This comes into play in two important ways:

First, when we put together a panel, we strive to find panelists with a broad diversity of interests to cover the broad diversity of proposal topics in a typical panel.  A major challenge is to figure out the best matches of panelist expertise with proposal topics. To help in doing so, we send each panelist a complete list of proposal titles and ask them to rank each from 1 ("I'd love to review this one and have the necessary expertise") to 4 ("I'm clueless or disinterested"). Although we sometimes overrule those rankings, we certainly pay attention to them. Here's the point: If you want your proposal to be reviewed by someone who can best appreciate your project and provide the most constructive feedback, your title is pivotal.  Make sure it concisely summarizes what your proposal is about and stay away from vague or grand statements.

Second, the same challenge of matching reviewers to proposals comes into play when Program Officers solicit reviews from ad hoc reviewers (i.e., reviewers who are not panelists).  While Program Officers may be confident in the appropriateness of a particular reviewer for a given proposal, all that reviewer has to go on when making a decision about whether to review the proposal is its title.  The problem is that reviewers are far more likely to say "no" if they don't have a good sense of what they're getting themselves into.

Bottom line: You don't want folks making false assumptions about your proposal's content when all they have to go on is the title. You can (and should) provide effective project titles.