Computer Way Too Slow

I ran Windows XP Pro for years (on Western Digital Caviar 250mb hard drive). About 8 months ago I added a Western Digital Caviar 750mb hard drive and installed Windows 7 Pro. All went well. It gave me the option of booting to the OS of my choice. I opted for Windows 7 with the XP version as a safety backup. No problems until about two weeks ago. Windows 7 started getting slower and slower. Coincidentally, around 4-30 microsoft update tried installing the service pack 1. It failed on seven tries before finally installing. Slower than ever. I booted into the hard drive with XP and updated drivers as appropriate and then watched. Although not as slow as Win 7 it is not as fast as it should be. I have an AMD Athlon II x4 640 cpu, 4gb of ram, and was running a Gigabyte Geforce 9600GT 512I graphics card (I've since boosted that to a Gigabyte Geforce GTX 240 896). My wife's computer only has an AMD Athlon x2 5600+, 2gb of ram, and an XFX Geforce 7900GS graphics card, runs XP Pro, and is much faster than my computer at this point. I've already uninstalled the service pack, checked my ram and cpu for potential problems. Thus far, everything checks out. I was inclined to believe I had a software issue until I booted into XP and see it running slow. I'm not sure where to go from here. BTW, I have a monitor that shows cpu, ram, disk, and network usage. There are times when it is barely moving in Win 7 but the cpu shows a usage from only 1-8% and the disk is using 1-5%. Any help would be most welcome..........

I don't have an internet issue. The overall speed of the computer has dramatically slowed, especially if there is any multi tasking going on..........