The main elements of tuning the bow are to set the brace height and the nock point. The main elements of tuning the arrow are to select an arrow that has the right spine and weight for your bow. Then there are more subtle elements, but if you get the four items above right, you will be 95% there.
If you search under these four elements: brace height, nock point, spine, and arrow weight, you will find many, many posts. They are also discussed in all the popular books on archery, such as Instinctive Shooting, by Asbell.
If the arrow wobbles, it won't consistently hit in the same place, and some of the bow energy will be wasted in making the arrow wobble instead of flying true toward the target. If the arrow is too light, it won't penetrate as far, and shooting it might damage your bow. If the arrow is too heavy, it is hard to shoot accurately because it drops too much in flight. The lighter the bow, the more these things have to be perfect since you have barely enough power to do the job anyway.