fyi, i have several dns-323 units connected to a wired Ethernet gigabit network that also has a popcorn hour a110. when i first got the PH, it had some serious problems like you described, but they were fixed with a PH firmware update months ago.
my experience has been that the PH will stream video fine unless you have a gigantic HD/Blue ray file (8gb files no problem, 35gb files=stuttering during playback). also, if you are ripping your own video, be conservative when you select how many index files you want -- because it chews up the PH cpu -- an index file every 8 frames will choke it, i set mine to every 120 (or more) frames (it doesnt affect video quality). remember that the dns323 is 100mbps max wired -- it doesn't have a gigabit onboard nic, so it is possible to overwhelm it (especially if you: have a gb router/network, have jumbo frames, have raid0/5/10 with a gigabit nic in the dns323/file server/pc sending the video (raid0 can saturate a gb network bandwidth).
make sure your PH firmware is up-to-date. downgrade your dns323 firmware to 1.07 -- dont use the beta, try setting your dns323 config from 1000mbps or auto-select to 100mbps and turn off jumbo frames. then attempt to play a 'normalish' DVD size file (4-6gb or so) on your PH. --if that fails, try playing the same file on your pc. if you have stuttering problem with both your pc and the ph, i'd say the dns323 you have is at fault.
with the (file size, number of index files) exceptions noted above, we're running the ph just fine in a multiple dns323 gigabit network using mkv, avi, iso, vob, mp3,... files.