Choppy Gameplay

I have been experiencing EXTREMELY choppy gameplay. Before you start theorizing regarding virus scanners and low CPU resources, be advised that no other programs are running in the background, save system processes and the antivirus which has already been disabled.

I run an AMD Opteron 2.0GHz processor with 4 x 1GB Dual Channel memory. From tracking the CPU usage using the History pane in Task Manager, the memory and CPU aren't causing this 'glitch'.

When connecting to the server, my ping rate is around 70ms or less.
I have a 10Mb internet connection, so my internet speed is not the issue here. (i have yet to perform traceroute on the server IP - will try tonight!)
During install, I downloaded directly from PWI and installed it an hour later. (yes, 2.4Gb in 1hr - it's nice to have a 10Mb connection !!)

I then verified the downloaded files, then ran the patch updates and verified them also.

I originally started out on the PVE server Heavens Tear (before I know what PVP was) and i could barely move my character without being 'respawned' back to my original starting point.

I've tried creating a new character on the PVP server ,Lost City, and I still get the choppy 'respawning' gameplay.

Here's what I experience when I play:
I attempt to move in a direction specified by the left-click of the mouse. My character moves toward the target but is then instantly repositioned back to the starting position. EG. if I was standing beside a tree and wanted to move over to a rock 50 feet away, I start to move toward the rock, but am then instantly put back to my original position beside the tree.
This 'loop back' or 'respawning' happens about 4-5 times before the character gives up and waits for a new directional command either by the keyboard or mouse.
I have found that I can (somewhat sucessfully) move toward the rock by left-clicking the mouse only a few steps in front of my character's current position. then repeat, over and over until I get to the rock.
In Etherblade, where the guards stand under the arch before you see the Elder, I can be walking in a direction toward the Elder, and pass by the two guards under the arch, and be halfway down the stone 'ramp' when I am suddenly finding myself back looking at the two guards again. I have 'respawned' back to my original starting position at distances up to equivalent of 100 feet (scaled to the size of the characters in PWI)

as far as graphics are concerned, when i reduce my graphics options (eg. down to 800 x 600 resolution) and put all settings to the lowest (eg. terrain, shading off, textures low, etc. the problem only gets worse. Normal gameplay speed is best on my system when operating at 1600 x 1050 resolution with all graphics options turned to high/full/on.

Another example:
Standing in the Etherblade outskirts next to some creatures. sometimes these creatures move 2 times to 5 times faster than they can actually move. I have seen the Pentastral Beetles move almost faster than the human eye can detect. they begin to walk around their little territory like they normally do, but then all of a sudden they start speeding up and it is at this point that I can no longer target them to fight them because they are moving too fast. After waiting about 5 seconds, the speed of the creatures stops and they start moving at a normal pace again.

I have never experienced a normal gameplay speed yet. I have friends that say that it is sometimes a little laggy in dense areas, but I experience this 'respawn' every minute of every hour that I play.

If ANYONE has any ideas to help me figure out why I can't get a normal gameplay - I'm open to your ideas. (unless you don't read this and start suggesting things that I've already tried)

(oh yeah, and I've got a ticket in for this, but the GM didn't have a clue as to why it might be happening.)

See you in PWI!