Have you tried shutting down Launcher and .NET? I've personally found that 99% of the problems I had were directly related to leaving those running. Cured most of the lag, stopped disconnects and error such as you are having.
I noted two things with this last update. There was over 7 gigs of trash left behind in the install directory as well as C:\Documents and Settings\<account name>\Local Settings\Apps\2.0 - I uninstalled the update, deleted all the old trash, and reinstalled the update.
The other thing I noticed (might not help you) is that the game defaults to running at a low priority. I kicked the program up to run at above normal priority and the rest of the lag and errors are pretty much gone.