nikey, I'm experiencing exactly the same thing! and judging by the other topics google brought up we're not the only ones
I installed Windows 7 a few weeks ago and everything has been running smoothly until yesterday, when windows live messenger started acting up in exactly the way you describe it.
After a >30sec freeze at startup, msn freezes every few seconds while typing and even longer at every action I try to perform (opening a conversationwindow, menu items, smileymenu,...). With wlm running my CPU is idling at 3-4% and memory use stays at a constant 40%.
I've tried every sollution I could find, from un- and reinstalling wlm to disabling the ssdp discovery service and fondling with the compatibility settings of msnmsgr.exe and swithching off all energysaving options: nothing worked.
The last thing I tried was the only thing that seemed to have some effect: I uninstalled wlm and manually deleted all files related to it. For about 30mins it worked like a charm, but when I closed the one conversationwindow I was using together with mediaplayer and some folder, it went back to square one.
I haven't installed any software during the past week, so that doesn't seem to be the cause. Anyone?