Hi, Parallels 6 running a W7 32 Bit slows both OS really down... it is partially not possible to work with it. Even Mac Os is running much slower with several "lag-" times... Is there any change for a quick update / patch for parallels 6? BTW from my experience the network connection useage could be part of the problem...
How much RAM is assigned to the virtual machine and how much RAM does your Mac have? Try lowering the amount of RAM in the virtual machine.
If you have a double processor assign just one CPU to the VM. My experience is that assigning 2 processors slows down the machine on both sides.