GMs HELP! Weird lag / game freeze issue ever since halloween update. Can't play any missions!

Ever since the update dropped I can not play the game anymore. Once the run gets going at any random point I will get a random lag spike where party members walk off the screen, monsters stop moving, and everything just stops. I can still move around but that is all. It never recovers and stays like that. Because of this I have no been able to complete any runs. When the game lags up I try to end task in the task manager and restart it but when I try that it starts to load the game and then the whole game freeze and says "not responding". I would really like to play this event but I can not make it to the end of any run.
Another issue I have is when I go to load into a depth at any random time it will sit at 0% and never load.
PC Specs
i7 950
18gb ram
560ti GTX
260GTX (Dedicated PhysX)
2x 500GB HDD in RAID 0
Windows Vista 64-bit
I play on Steam.
My Extra.txt file has..
-server
-XX:+UseParallelGC
-XX:+UseParallelOldGC
-Xms1g
-Xmx2g
Here are 2 videos of what happens.
The first video it starts happening at the end of the video but I stopped recording
The second video it shows how the game is once it has happened. It never gets better or changes once it does the lag thing.
PLEASE help GMs I have not been able to play these new missions or enjoy this event at ALL ( minus buying the costume with crowns but how much fun is that really? )

I don't usually Spike Lag but randomly my game freezes for about 10 seconds since the latest patch. Not only in Apocrea missions

What about randomly deciding to close with no crash report whatsoever? And then coming back to realize you're dead? Thus wasting both Sparks of Life and your patience?

That too, I really wish in general I could just unbind ALL of my items in the game, sell them for Ce, get keys for Team Fortress 2, and be done with it since I am sick, and tired of issues with this game. To begin with I just want to be done with this game for good from now on since even if they fix this soon I really wouldn't care anymore. I've already exhausted myself from trying to avoid Punkin King, Explosions, and everything else that I just don't care for this event any longer, and to think I waited all year for the Hallow event that I came to love last year. Basically I can only sit in Haven, and talk with other people now...

@ Chaozxelectric - Don't forget being able to sit in your guild hall! So much fun O_o
OOO doesn't care about us. Plain and simple. At least that's what they show us.

It's funny cause I submitted a support ticket, stated my problem, and everything. I have over 2.5k hours in this game, more than enough money dropped into it, and I'm treated as if I am just a speck of dirt. I really wish that either they had a larger team, collaborated with the community, and actually listened to their fans since at the rate it's going now this game will not last.

yeah this is absolutely miserable :(
I tried to play through my client freezing every 3 or so seconds, but I end up using 15-20 sparks of life per apocrea level :( ended up giving up after becoming increasingly frustrated to the point of not wanting to ever boot the game up again...
please help us!!

Benchmark your internet connection? What are your download/upload speeds? You're at 4 bar at least in the FSC video so there shouldn't be a lag that lasts that long there so that's a little strange.
If you're positive you're running a strong spec'd computer and solid internet connection, consider creating an extra.txt file at the SK root folder (should be somewhere under steamapps/common/spiral knight/ and the directory should have files like projectx.log, getdown.txt, etc.).
Within the extra.txt file try adding just "-server" and save the file. Boot up SK and see if there's any improvement?
It could also be a location issue, which isn't really resolvable. But I do experience a bit of increased lag due to the event, but not to the same degree you're experiencing.

I tried the speedtest site and the numbers were pretty much the same as they have always been.
I do stay at a solid 4 bars when this happens and my FPS stays solid as well. No drop.
I added the extra.txt file and -server and it still ended up doing the same thing.
I understand there is more server load due to the event but this has never happened before and I mean should the game be rendered unplayable for a group of us? I never have unstable internet and it doesn't even seem like the issue is on my end. I have tried so many things on my end the list is endless and still nothing fixes it. Played on lowest graphics settings tried it with the check boxes on and off for graphics stability and what not. Did a clean install 2 times. Rolled back Video card drivers, tried running with different party configurations, US or EU server, changed the amount of people, made sure no one made any large blasts. Nothing has made the problem stop so far.

- Most likely not a graphics issue, I wouldn't mess with graphics drivers since you are able to get ingame and at least get to a party button, load graphics, etc. Any graphics drivers related issues would have occurred long before. Don't mess with this so much or else you might cause graphics issues accidently (using old versions of video card drivers, for example).
- Can you monitor how much memory and CPU Spiral Knights is using in Task Manager when it is running? What about once it crashes and says Not Responding? How much memory is free? What about CPU?
- What version of Java are you running?
- What firewalls do you have installed?
(Is there a reason why you're still using Vista on such a lovely spec computer? Shouldn't be an issue, but I still feel compelled to ask...)

Both while running normal and at time of crash:
Memory Usage: 785k
CPU Usage: 12%
I have 18gb of ram so plenty free and my CPU is got so much headroom with everything running plus SK i think 75% CPU is left over free.
Java . Com says "You have the recommended Java installed (Version 7 Update 45)."
Whatever firewall comes with Win Vista64. Yes it is on. Yes SK is allowed through it.
At the time I initially built the computer this was the best OS on the market. Don't have the extra money to upgrade the OS now nor am I in a rush to as I am pretty happy with this current one.

I used some workarounds on my computer to mitigate this:
1) disabled vertical sync in the game. On Mac OOO broke the vsync option anyhow, as it tears now with random 200 ms pauses.
2) no longer running in windowed mode. The game on Mac stalls out randomly like when having vsync on when it's not in fullscreen.
Basically SK stops producing gfx frames for a few hundred milliseconds every second and no longer respects vsync. This used to not be like this earlier this month...

I never had vsync enabled in the first place. I will try running in fullscreen mode I guess but I dont see why out of the blue it would cause this as I have always run in windowed mode since i first started playing.

Bump!
Still have the same issue! Have not been able to play for weeks.
Seems as though you, and I are in the same boat on this dilemma. To be honest I'm to the point where I don't wanna play this game anymore. I really hope they fix this soon, or at least give the few people experiencing this nightmarish glitch some sort of compensation since this is nothing short of irritating. Especially since hundreds of other people are enjoying this update to it's fullest, and us small few are just sitting here waiting to play an actual full level without any form of error.