IO Wait is any idle time during which there is an i/o pending. It's not always a bad sign, such as with a disk intensive application that doesn't require a lot of processor (like an OLTP database).
As processors get faster and faster and disks (relatively) don't, I'd expect to see more and more IO Wait. As long as your disks are 100% busy and you also see some actual Idle cpu, it's nothing to worry about. If you do have either of those symptoms, you need to improve the performance of your disk subsystem.
Rod Knowlton
IBM Certified Advanced Technical Expert pSeries and AIX 5L
CompTIA Linux+
CompTIA Security+