Timout - SQL Not Responding Under Heavy Load

Hi,

Our app uses an NT4 SQL 2k box and a Win2k IIS box.  To fulfill the text searching requirements we've had to use dynamic SQL (created within a large SP).  This query searches about 8000 rows in a flat table (which we create and keep up to date using a scheduled SP which trawls the underlying tables).  It's a complicated SP, and can return all 8000 rows (I think we're winning the battle to have this capped though).

When we get about 50 users hitting the app and doing searches simultaneously, performance drops severely (20 secs+ for a query rather than ~2 secs), and we get a lot of errors - which report that:

Source: .Net SqlClient Data ProviderMessage: Timeout expired.  The timeout period elapsed prior to completion of the operation or the server is not responding.

We also get a lot of Invalid Viewstate errors, which i'm totally baffled by, and the odd IIS Access Denied error - as if authentication (NTLM) is timing out.

Neither the Web not the SQL machines are being hit very hard - the web server in particular is not under any strain whatsoever.

It doesn't appear to be related to connection pooling, from the logged error messages we're getting.

Does anyone have ANY suggestions as to where I should be looking?!