When my Windows Server 2008 R2 machine is performing any large disk operations (copying 10GB files from one drive to another, copying similar file over network, merging HyperV snapshots, compressing large files), performance of the whole machine slows down terribly, everything becomes unresponsive. This is noticeable in any situation when the disk access is large enough not to fit in the cache.

Are there any settings available for tuning this behaviour? I can accept slower file transfer if this would give me more responsiveness.

System details: Dell Optiflex 960, Core 2 Quad Q9650, 8GB RAM, 2 SATA drives - 320GB (ST3320418AS) and 1TB (ST31000528AS), NCQ active on both, Intel 82564LM-3 Gigabit Ethernet, ATI HD 3450 graphics, Intel ICH10 bridge. We have multiple machines like this, every one is exhibiting the same behaviour. I though this was overkill for a workstation, apparently I was mistaken.

Update: I guess I shouldn't have mentioned the HyperV at all. The above configuration is a standard workstation setup at the company I work for, this is not a server of any kind. I have at most 3 virtual machines working, and usually I'm the only person accessing them. Never the less, the slowdown occurs even when no VMs are running. On a Linux machine I'd simply ionice the copy process and I could forget about it, is there any way to manage IO priorities on Windows?