I just installed the retail disks and ran the game. In Ascalon it was so laggy I could not move 90% of the time. This is weird since each district can only hold 100 people, meaning that a district can't get overloaded. Must be big time network problems for NCSoft.
Could it be your RAM? I had a lot of lag with 256 RAM on WoW and people I knew who had 512+ didn't lag at all. I have not yet even bought the game, but I plan on it and I am trying to help where I can.