Well, I have been a player of WoW since the US and Euro betas, and from back then til now, I have been with Wanadoo, Nildram, and Virgin Media... and have had issues with World of Warcraft all along the way. Not every day, but there have been days when it has been really bad.
I remember a 40 man run to BWL back in the day and I coudlnt stay on for more than 5 minutes a time as it kept disconnecting me.
90% of those times it has always been Telia that has been at fault, as you know, Blizzards ISP hosting our beloved game. Packet loss always (normally) occurs when it hits the Telia network for me.
The other 10% (I guess) would be my ISP's (Wanadoo, Nildram and VM) problems. I don't think this is a problem just affecting VM mate, as much as I would like to point the finger right now at them regarding my 50 meg speed issues, I still believe its Telia who is shafting us, the subscribers of WoW.
Hope you manage to find something out though
I have tried endlessly over the years but always comes back to Blizzard having a sucky Swedish/Finnish ISP (TeliaSonera) =(
James