Well this is "normal" behaviour
Even when you are downloading only, you are still sending information back to the source
like acknowledging that you received the packet that was send, requesting another packet, etc...
so if you are using all your available upload bandwith to actualy upload data, theres none left for the download "control" part... thus your downloading starts to suffer....
So its always good practice to limit your upload bandwith when dealing with p2p, limit it at around 60-70%of your theorical maximum...
And yes if you are using QoS, you can select which protocol has priority, but like scaramanga said, this is very CPU intensive, and is not always 100% accurate.
Best options for you are to QoS by IP or by Port if you can...
Since we are talking about the DNS, QoS by IP would probably be better.... just assing the DNS-323 IP the lowest priority possible... So whenever a different IP (computer) is doing something it will have priority over the DNS-323.
This way, QoS will give all the bandwith that the other IP requires, and leave the rest to the DNS-323.