Airport express streaming audion drop out is unacceptable

The only reason I bought the airport express is because apple discontinued the old Apple TV mk1 - which had an analogue audio out port.
The comments on this group seem to always suggest the following (1) Don't extend a wireless group (2) Don't join a WDS (3) Upgrade firmware (4) choose a less congested channel (4) swing a dead cat around 12 times at midnight.
So the configuratioon
MAC BOOK PRO Snow leopard 10.6.4 -- 2.6Ghx INTEL Core 2 Duo, 4GB 667 Mhz DDR SDRAM
2 Airport Extremes [7.4.2]
1 Airport Express [7.4.2]
1 Time Capsule [7.5.1] (making a total of 3 Airport Extremes)
iTunes 10.0.1 (22)
MAC BOOK PRO disk checks out perfectly - format structure, file structure and hard disk sectors.
All Airport devices are at the latest firmware revision.
no WDS - each Airport Extreme "Creates A Wireless Network" - but uses the Time Capsule for DNS.
THE AIRPORT EXPRESS IS SET TO "NO WIRELESS"
The connection to the Airport Express is 100BaseTX via an intelligent router.
So - basically - NO WIRELESS CONNECTION to the Airport Express from the MAC BOOK.
MAC BOOK PRO -> (100BaseTX) Intelligent Cisco Router -> (100BaseTX) Airport Express
Every 4 or 5 minutes the sound will drop out for a second or so - right in the middle of a song.
The Airport Express has even been configured for NO WIRELESS.
Streaming Netflix to the TV makes no difference to the time between audio drop out - which suggest that the network is more than capable of handling the traffic.
Netflix also streams perfectly to the iPad (Wireless)
Network utilization is negligible. Network reliability seems excellent : 90M Sent packets, 70M Recv Packets ZERO errors ZERO collisions.
I noticed that when I use the iPad for remote control (V2) of iTunes on the MAC BOOK PRO - the drop out is worse (even when the iPad is not doing anything other than, I suppose answering a few "are you still there" inquiries). Interestingly, even with the iPad connected - but - control of iTunes from the Keyboard - the interval between drop outs is significantly greater.
I have not yet tried streaming the AppleTV Mk1 to the Airport Express - my bet is that it will stream perfectly.
It amazing that Netflix can stream perfect video and sound over a 20Mb internet connection (using the same Extreme as the primary DNS ie attached to the Time-Warner modem) and yet Apple cant even get consistent audio in a hard wired 100Mb intranet.
At the low data rates for streaming Audio - finding way to configure the Airport Express to effectively improve its response time hint at a significantly larger issue ie (a) iTunes not running at a sufficiently high priority (b) Small Internal buffer in the Airport Express (c) my guess both (a) and (b)
iTunes is set to "Large Buffer".
I have not yet tried 'nice'ing up the priority of any iTunes processes - as I've gone back to having the house Audio driven by my old reliable Apple TV Mk1.
If Apple cant even get Audio Streaming working properly - I don't hold out much hope for the AppleTV Mk2 (hopefully it has a seriously large buffer to compensate for the pre-emptive scheduling of MAC OS) - This may be one example of Windows being a better streaming Audio Platform that MAC OS.
Given all this information - other than "kill all the processes running on the MAC" - which completely defeats the purpose - that is to say - I had a perfectly great Streaming Audio "Appliance" (the Mk1 AppleTV) - now I'm being forced to use a GP Computer with all the inherent problems of reliability.
Any suggestions ?

No, in fact I abandoned it. Then I tried it again today, (hoping the various iTunes updates would help) it was better ... But after 15 minutes the audio dropped out again. However, my concerns about the apple tv2 were unfounded.

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