Having Trouble Hosting-NEED HELP!

Last Result:
Download Speed: 9286 kbps (1160.8 KB/sec transfer rate)
Upload Speed: 905 kbps (113.1 KB/sec transfer rate)

xbox live requires at least 256kbs for you to log on/play and to host about eight people. i have many problems here that just confuse me beyond belief. i used to have that crappy 256kbs upload. about five months ago i upgraded to the connection that you see above.(anyone who knows xbox live knows that this is more than enough) you can also see that it's near fives(x) what xbox live requires. i know i have these new speeds because i've ran multiple tests and multiple sites...i've also sent and received from buddies over different messenger clients...the problem is pretty simple. i try to only host twelve people on xbox live. i'm capable of sixteen.(EASY) but twelve is the best number for the games that i play. basically the people i'm playing with are getting lag. i usually have a group of individuals that i play with on a daily basis. before i upgraded the connection, those eight to ten people could connect to me with minimal to 0 lag....why is it that when i have a connection that is a crap load better, i receive lag? i've called my isp and they've confirmed that everything is more than fine. they've come to my house to test signals, everything is fine. i'm on cable by the way.(figured that may help someone...help me) i've called xbox support and everything is also fine on their end. some might want to say it's my router.(linksys wrt54g v2) guess what...? i've direclty connected the modem to the 360 and received the same results. can anyone give me some advice? it sucks because the whole reason i'm paying the extra money is to host my own servers in gaming

i could really use the help guys thanks