Horribly, and Totally Annoying Wi-Fi issue with Ne...

Hi Everyone,
First post, so be gentle.
OK, we have BT Infinity, and wire (Lan) connected no problems, and never had a wired problem.
The problem is with the WI-FI. The BTHome hub we have is the 'curved' black one (model 2 I think).
Here's the annoying (seriously annoying if I am honest) problem:
When our WI-FI connected devices are on, and working they are fine (iPad, smart TV, laptop, phones, computer, etc), BUT as soon as our neighbours put their WI-FI on, our WI-FI IMMEDIATELY drops out, and becomes unstable to the point of not being able to connect. There is one neighvour in particular who is using TalkTalk (it shows up on available WI-FI's to connect to on iPad) and when he is online, we simply cannot get a stable WI-FI connection.
Example of Problem:
If we are using our WI-FI enabled device, lets say an iPad for example, and if we suddenly stop being able to connect to the internet, I KNOW it is because our neighbour has just logged onto their internet (I check this also, as the iPad, as do most devices show all available WI-FI connections).
What we have tried to fix this problem:
Now, you first thing you would probably pre-empt it "Change the channels as your neighbour is probably using the same channel".
This does not fix the issue. I have tried all channels, restarting devices, rebooting the HomeHub (even though I should not have to), and NOTHING fixes this issue, not until our neighbour logs off from his internet; then we can use ours again. How totally crazy is that?!
The fact is, if our neighbour has his WI-FI on, then our's becomes totally useless, and it seems there is not a thing we can do about it. We have tried everything, and nothing seems to help.
Have you fine people heard of this issue before, or can you please offer any advice? As we are seriously considering switching from BT due to this issue, and their tech help (BT/India) have been 100% useless on this matter.
All the BT tech support will say is "Change channel, change channel, check device, check device", and other such insults to my intelligence, when I have already told them I have checked them.
Thanking you in advance.
Regards
Steven 
PS - I cannot use inssider3, as I am using windows XP and it does not support it, but I have changed every single channel with the same result.

If you have a HH2 it only works on 2.4 Ghz it might be worth "upgrading" to a HH4 or some other router that uses 5Ghz if your neighbour is not using 5Ghz you should be able to use your Wi-Fi without interference.
5Ghz has advantages of speed over range however it is all very well having a 5Ghz router if you have nothing that will receive 5Ghz. I have at least 10 Wi-Fi devices in occasional use only an ipad 2 can operate on 5Ghz or actually it can't it can see 5Ghz and log on but then it just sits their and does nothing except trying to download. It is actually faulty as I  borrowed one of the latest ipads and it worked well.
it would be interesting to know how many people have anything other than a phone or ipad that works on 5Ghz I know you can get dongles but that is something else to stick out of a usb port and break off.

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