When battles are happening, game freezes for a second...every second

As the title says, whenever there's a battle going on in Sins, or Entrenchment, my screen freezes for a second, then goes normal, then a second later it freezes again, then goes back to normal again. It's like a split second skip. I thought at first it was because the buddy I play with doesn't have a great PC and was laggin me, but he says it runs smooth. I can see lasers freezing in mid air for a second, but he can't.

I'm running a quad core Q9550 with 4GB of RAM and a 4870x2, I shouldn't be having these problems.

Another option we thought of was connection, so we switched from me hosting it to my buddy, still didn't do anything.

It's fine for the first part of the game, but when a lot of units are made and then a battle happens it lags every friggin second for me, but not for him. It skips for a split second at the first signs of the lag, then the skips take longer lasting a second or so.

Is it possible that even though he's running smooth that it could be him slowing me down? I can recall times where we save the game, I get him to leave and it speeds back up again, but why doesn't he see the same lag and freezes every second that I do?

Another theory, he has a single core processor and an AGP video card. Could it be that my system is running faster and therefore my game has to slow down so it doesn't process ahead of his, and therefore throttles...or freezes me for a second so his sytem can catch up? Thus he can have smooth gameplay because his system isn't waiting to catch up.