I doubted the monitors at first too and chased the network configuration for a while but ended up going back to blaming the monitors. Both T3400's have the same image and hardware configuration. I did not swap the monitors because the slowness is occurring on all Dell monitors.
Here's some other troubleshooting that I tried. I switched from a DVI to VGA connection and rebooted -- still slow. I then switched back from VGA to DVI and rebooted and it started functioning normally (both at 8Bpp and true color). So then I tried rebooting the machine next to it with a DVI connection (and without swapping cables) and it did not make it any faster. It makes no sense!