Is encrypting an external hard drive prior to Time Machine equally secure as TM encryption? It's more it less an order of operations, but should I format and encrypt the external hard drive first without any data and then run TM?

I figured that way would be faster rather than TM having to encrypt the data on the fly.
I'm not sure I understand what you are trying to do. A drive is encrypted only by virtue of receiving encrypted data, it does not encrypt anything itself. So if you write from your unencrypted disk to your encrypted one (via Time Machine), all data still has to be encrypted by your mac prior to being written to the external medium.
So I don't see why encrypting an empty drive before writing to it should change anything.

The reason why encryption does not noticeably impact performance is that the speed bottleneck in this business is the disk access, which is waaay costlier in terms of runtime than the encryption of the data. Modern processors even have specialised instructions to speed up e.g. AES which is used for Time Machine I think. So even if it worked the way you seem to think, it would probably not gain you much.