Hmm it runs smooth for me, towns can get a bit laggy when they first pop up but thats to be expected in my opinion. The .ini files can be edited to help out a lot and also doing a /flush in game should help a bit. But i do admit, it probably drives a lot of people away since you need some pretty high end stuff just to get it to run okay.
My friend is able to play on a 6600 and 1.5 gigs of ram on low settings, he lags in towns but surprisingly not too bad elsewhere. I dont know how he does it