You basically have two options when it comes to the kernel, or any software really. Either you can compile it yourself from source, or you can use a precompiled (packaged) version.
A precompiled kernel is the easy way to go about it. Everything has already been done for you and all you have to do is install it. But a precompiled kernel is a generic kernel. The people who made it had to configure it to run a variety of hardware/software combinations. Such a kernel will thus generally be a bit larger and slower than one you make yourself.
Compiling from source, OTOH, gives you better performance generally, as your kernel will end up being configured perfectly for your system. You can choose to leave out anything you don't need, or add anything you do. You can also compile in support for hardware or other settings that the generic kernel might not supply.
For example, I just finished compiling a new kernel myself. Since I often need to share files with Japanese Windows computers, I chose to compile in in support for FAT filesystems with Japanese character encodings. Now whenever I mount a FAT disk with Japanese filenames, they automatically appear correctly (It's possible to do this with mount command options, but since I encounter it often, it's much more convenient to have it in the kernel). Prepackaged kernels will almost never have something like that.
OTOH, compiling things yourself is generally more difficult to do. You have to understand the settings options and possible problems you will encounter. Library dependencies are a big headache, for example. With a kernel, there are literally hundreds of options, and very little guidance about what they all do. You can very easily compile an unusable kernel. But mostly it's just a learning curve. Once you become experienced at it, it gets much easier.
So the short form is, easy but generic, or complicated but optimized. It's your choice.
The same is true of any program out there.
I hope this clears it up for you.
PS: If YUM is anything like Debian, there might be source packages as well as kernel packages. Whereas the kernel packages will install a working kernel onto your system, a source package just gives you, well, the source for the kernel. You'll still have to compile an actual kernel yourself from those files.
