@RipaX21 and James161324: Thanks a bunch for your input.
I'll definitely try switching to another 10/100 port on my router to see if that helps.
Last night I went into my WRT54G's set-up to see if I could fine-tune any settings and I made a few tweaks here and there. I even went as far as no longer broadcasting my SSID just in case the back-and-forth pinging (minuscule that it is) was affecting bandwidth. One thing I will do tonight is update my router's firmware to see if that helps. It's also worth mentioning that when I game over XBL, I make sure to power-down every other network peripheral in my house to ensure maximum bandwidth.
After no improvement, I bypassed the router altogether and plugged directly into my cable modem. After a full power cycle (both the Xbox 360 and the Cable Modem) I was up and running. While lag improved a little (e.g. I was no longer getting lagged out completely), I was still experiencing a tremendous amount of in-game lag (e.g. hopping all over the map and having little to no control over my character).
Was has me particularly confused is that I've very, very rarely experienced lag when playing on XBL over the years (primarily CoD4:MW, CoD:WaW, GoW and GoW2)... moreover, MW2 was running fine in the first few days following MW2 launch.
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