I'm back again skyep with a far more accurate answer! Here goes:
As a general rule you should use fine grind for espresso, medium for filter and coarse grind for cafetiere use.
For espresso make sure you use the recommended dosage of coffee and it should take 20 - 25 seconds to extract 1 fluid ounce (that is presuming that your espresso machine pump pressure and water temperature are correct).
As a rough guide for fineness of grind for espresso it should not feel like talcum powder but more like sand. The finest adjustment can make all the difference to the extraction time.
Filter coffee should be twice as coarse as espresso coffee. Cafetiere coffee should be approx twice as coarse as filter coffee and definately coarse enough that it doesnt come through the mesh on the cafetiere. Let it sit for 4 minutes before plunging.
In summary, grind does effect the difference in taste of the coffee because the grind effects how long the water is in contact with the coffee ie the finer the grind the harder it is for the water to find a way through it so it extracts more flavour. However, too long is over extracted and will bring out unwanted bitterness. The trick is to extract the quality flavours from the coffee and leave behind the bitterness.
Hope this helps skyep. If you have any more questions he is happy to clarify/assist. Happy christmas.