When headsets are new, it makes little difference how they are made. As long as they are properly adjusted, cheap ones feel about the same as expensive ones. The difference shows up after a bit of hammering.
A major advantage of better headsets is usually in the sealing: cheap headsets allow in rain, mud and dust, and then deteriorate quickly. Once headsets start to get sticky, they retain everything that gets trapped in them as a paste. Soon this wears pits in the bearing surfaces, and then the bearings fall into the pits as you turn the bars, rather than rolling smoothly. This is new headset time! Basic headsets use two rings of ball bearings, sealed above and below with a rubber washer. If you have this type and ride in wet or muddy conditions, build up a regular servicing habit to keep your bike running smoothly. Consider servicing your headset twice in winter and once more in summer.
A variation on the loose bearing idea is the needle bearing. Instead of a ring of balls, these use a ring of small rods fanning out from the centre and sitting at an angle. Some people swear by them. We prefer our ball bearings round. If you have needle bearings, treat them in the same way as standard round bearings.
Cartridge headset bearings are more expensive. Instead of loose bearings, the bearings are set top and bottom in cartridges that fit into the headset cups. The advantage of this system is that when you replace the cartridges, you replace the bearing surface as well as the bearings themselves. It’s a very good idea for headsets, since replacing the cartridges is equivalent to replacing the headset. They are more expensive than buying ball bearings, but less expensive than buying a headset, especially when you take into account the extra time it takes to fit new headset cups, or to pay someone to do it for you.
There are several different types and shapes of cartridges, so take the old cartridge to the shop when you buy a new one. They can be serviced though – see below. The bottom race is worked harder than the top race, so swap the top and bottom races every service to get maximum life from them. Cartridge bearings can be replaced easily, with the advantage that as well as replacing the ball bearings, you also replace the bearing surface on which they run. If you can catch them before their condition gets too bad, they respond well to a cleaning and regreasing. This is only easy if they have a plastic seal – otherwise replace them.
Servicing cartridge bearings
Step 1: Using a very sharp knife, carefully peel back the seal on one side of the bearing. Take care not to bend the seal or cut it. Keep the knife as parallel to the seal as possible. Always push the knife away from your fingers. It’s easy to slip and cut yourself – take care. Once you’ve lifted the seal, run the knife carefully around the seal, lifting it off without bending it. Repeat on the other side.
Step 2: Soak the bearing in degreaser and scrub all the old grease out. An old toothbrush is perfect for this. Dry the bearing; hairdryers work fine (we strongly recommend cleaning off all the grease and putting it away when you’ve finished and will not be held responsible for any failure to do so). Clean the seals.
Step 3: Pack the bearing half-full with goodquality bicycle grease. Spin the bearing to spread the grease evenly around the bearings. Refit the seals, easing them into place with both thumbs. Wipe excess grease off the outside of the bearing.
Source : BIKE MAINTENANCE TIPS, TRICKS & TECHNIQUES
See also bike maintenance tips, tricks and techniques “Threaded headsets: servicing”