well maybe the lag thing is just me. is there anything you can switch on or off to limit the lag. I know my pc can handle the load. I have a intel quad core 2 cpu and a nvidia geforce 8500 series. all my other games run great. for the most part this game runs great. except that dam cradle and archive.
The 8500 isn't exactly a "gaming" card, as it is much less powerful than the rest of the 8000 series. However, I used to have an 8400 and these settings would always give me >40fps:
Resolution: 1024x768
Model Detail: High
Texture Detail: High
Shader Detail: Low
Water Detail: Reflect World
Shadow Detail: Medium
Color Correction: Enabled (Has very little performance impact from my tests)
Antialiasing Mode: None
Filtering Mode: Trilinear
Wait For Vertical Sync: Disabled
Motion Blur: Disabled (Has little performance impact other than a short pause when turning quickly, which easily becomes annoying)
HDR: Full (Make sure the Use Bloom Effect When Available is unchecked)
The most important parts are the shadow/shader detail, the lower resolution, and turning off antialiasing.
Had always worked for me to get great frame rates.