If living an infinite number of years is virtual impossibility, then it must logically be a finite improbability...
I, for one, welcome our new ulgy American overlords...
I went through a similar experience recently with my Windows XP machine - tore my hair out going step-by-step through every possible cause.
It happened after the out of schedule Windows update. Turns out that Microsoft, in their infinite wisdom, turned on my McAfee real-time virus scanner. I't brought my system to a crawl whenever I'd try to play World of Warcraft. I didn't show up anything on Process Explorer and my video worked great, but my latency would slowly spiral out of control until it became uplayable.
I suspect that the real-time scanner was trying to process all inbound trafic before allowing it to pass on the calling process and it just couldn't keep up with the data bandwidth. Even disabling various McAfee security services didn't fix it - only uninstalling McAfee worked. Now my system runs better than ever (after having defragged a dozen times, uninstalled every unnecessary process imaginable, and cleaned the exhast fans).
Long story short - uninstall your virus software.
A Chinese Hacker