ILLogical IIS performance - EXTREME slow

I'm running a Windows 2000 advanced server at home on a cable modem (also acting as a proxy). Everything else is working well except my FTP performance. Here is what happens:

If I am browsing the web on a client behind the proxy all is well. Suppose I begin downloading a large file, my transfer rate averages 90 kB/s.

Then a user logs onto my FTP and begins downloading. Here is where the logic doesn't make sense to me. That FTP user starts downloading at a rate of 12 kB/s. At that exact instant, my transfer rate drops to 1kB/s (from 90!). If that user stops or finishes the download, my transfer rate on my client zooms back up to 90 kB/s. Also, browsing the web on any of the 3 client PCs is EXTREMELY slow. About 30 seconds toload yahoo's main page. Normally it should take about 3 seconds.

Now I understand that having an FTP user consume network resources should impact my internal LAN's performance, but this is so drastic that I can not viable browse the internet if I have a user downloading from my FTP server!

Thanks for any help and please let me know if there is anymore
information I can offer you to help you, help me.

BTW, my CPU and Disk performance never go past 5% utilization and during all of the slow internet problems, I'm still able to copy a 5MB file to and from my server (internally on my LAN) in less than 5 seconds.