3939B DHCP issues with static 13 block loaded

Strange issue here,

New Cisco 3939B (and has already been swapped to try to solve issue)

Static IP devices work perfect and route traffic perfect,  DHCP devices will intermittently hang and freeze loading web pages.

I can literally move a PC from the static network to the DHCP 10.1.10.1 network and it is immediately affected.  

Have tried multiple devices and PCs same results.

75.75.75.75 and 75.75.76.76 are the DNS addresses programmed into the modem by default.  We have tried 8.8.8.8 and 8.8.4.4, no effect.

Issue remains when plugged directly into modem with or without any other devices plugged in.

I can say that this issue showed up after we started using the CIsco 3939B 1 month ago.

We had an SMC that was working flawlessly until one day it just died without warning.

Have had many conversations with Tech's in person and over the phone regarding this strange issue and noone seems to be able to get a firm grip on what the cause might be.

Any ideas appreciated.