I'm not entirely sure the statement about always use varchar and not char variables is true.

Varchar data types in a table are stored differently in the page file than char data types, varchar data types, while giving you the benefit of being only as long as the text you put in them, are not stored in order with the rest of the fields. Instead a pointer is stored in the varchar fields place. This points to the end of that record in the paging file, where the length is stored, and then it reads the varchar field from the end of the record. Using varchar fields for short text often takes more processor time and space than if a char was used. The pointer and length field combined take up (4 bytes?), I believe. Take consideration on every field under 10-15 characters to be a char field. Fields like state, gender, any field where the length is known, and the field is short.