I am posting this information in an effort to prevent others from tearing there hair out over this. 
We recently purchased a number of Dell Optiplex 960 machines including ATI Radeon HD 4600 Series video cards. This particular video card has two DVI ports on it. We have two wide screen Dell 2408WFP monitors hooked to the card. After updating the driver for the video card we bagan to experience very slow response time from the Java Report Panel in both IE 7 and Firefox 3.5. After a number of tests we discovered that it was due to the version of the Java JRE on our machines. 
We found we had to have AT LEAST the Java JRE 1.6.0_10 for the Java Report Panel to respond normally. Any JRE version older than that in combination with the updated video driver causes a spike in CPU usage by the browser and very slow reponse from the Java Report Panel. This also appears to be an issue only when using two monitors via DVI connections but our tests are not conclusive with other monitor combinations.
Rolling back the video card driver would also fix the issue but we had to update the video card driver to fix another issue we were experiencing with the monitors themselves.
I hope this helps others who might bump into this wil Dell Optiplex machines and ATI Radeon Video Cards.
mgrackin 
(BOB member since 2002-08-29)