World of Warcraft disconnection problem

[Lopaton]

PC:
Intel Core2Duo 2.66
4Gb Ram
ATI Radeon 3870 512 Mb
100Mb/s connection (theoretical, speedtest shows around 1-2Mb/s to the place where approximatly game server is located (though not sure, I may mistake Mbytes and Mbits per second))
Problem:
In heavy action situation (25-man raids, 40*40 PvP zones) my ingame latency increases (from usual 160 to 400-600, but not always, sometimes freez problem appears without latency increase), sometimes I get kind of freezes - everything stops from doing anything and in a few seconds (if I was lucky) I get quick display of actions that happened during that time (if not lucky I simply disconnecting, often unable to log back for some time - I log, see boss and DC again).
Problem appearred around 2 weeks ago after my ISP did some maintenance on line (may be coincidence).
Using WinMTR shows package loss of around 2% an the first hop. Pinging that host confirms that - one of 30-40 pings fails.
Question: can 2% package loss be reason of disconnection from game or that is usual thing in Internet?
PS. A bit offtopic subquestion. What should I set in paging file settings if I got 4Gb RAM and 32bit systems are unable to address more? (current values base - 2Gb, max - 4Gb - isn't it waste)

[-WOLF-]

Hello and welcome to TSF.

I think that the maintenance that your ISP performed somehow either damaged the internet cables or just made it worse. I'd check with your ISP to ensure you're getting the speeds you're paying for.

While 2% packet loss isn't horrible, it can certainly be noticeable, especially with programs that require all the data possible (videos, and games mostly).

To answer the last question, 32-bit operating systems do not use the full 4 GB of ram you have; they only use 3.25 GB of RAM, in order to address all the ram you need a 64-bit operating system.
You only need to allocate 2 GB minimum for Vista to use, but I recommend not changing this setting as the default is just fine.