I completely uninstalled Kaspersky and there was no change (I'm not overly suspicious of it, it's one of the top-rated antivirus offerings). I then discovered that other games are also horribly slow now, so it's not LotRO-specific. I'm currently looking into recent Windows updates--I've found articles saying that certain updates really hurt performance, but so far I don't appear to have any of these updates installed.
Something is "stealing focus" away from the game; you get the same effect if you run the game windowed, and then start using any other program on the rest of the desktop.
Someone else was reporting this issue recently, but I dont remember if they posted what was causing it.
I am willing to bet it is something MicroGit has done.