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Installed the latest Patch # 4 or #5 to those machines?? The slow down during autoupdating was a major issue in the "first edition" of VS 8.5i.. The patches seem to help quite a bit. In addition, we schedule our updates during lunch time so a drag from the update isn't noticeable.
Autoupdate scheduling is adjusted on the local client machine.. Open the VS console by RIGHT clicking on the VS icon in the lower right corner, choose "VirusScan Console". Once that's open, then double click on the AutoUpdate listing, click on the "Schedule" button, then the "Schedule" tab and change the time.. We also find it better to stagger the various machines for update.. It prevents the server from lagging when ALL the computers update at the same time.
Hope this helps.
you may also want to download sysinternals (I believe that on the Microsoft site now), and get some of the applications that can view the current threads and processes that are being run (MUCH more information than using Taskmanager).