Windows 7 / 8 Security

Question

I am having constant issues with having my home network hacked.  I have some neighbors that are having a one sided fight against me, not exactly sure why, but one is a network administrator and since this began they seem to be able to make my windows
horribly unstable, I get white icons, windows update hangs, shutdown hangs, very slow file search and even to just populate the left side folder options may take ten minutes at time.
Also, when launching small apps (ie. core ftp) there may be a  five minute delay from double click to launch.
I can rebuild all the software and update drivers and not plug the machine into the network and it will run perfect for as long as it is unplugged.
He hacked my local network, which I was able to catch on my router log the strange machine name and mac address, then hacked my main business server taking it down, the off site backup and then erased the MFT and the mirror MFT on the local hard drive.  
I have tried every fixit and step by step repair for all the issues I am having but to no avail.  Also sfx /scannow says all files are OK.
My questions are.....  
With no virus, rootkits or other malware on the network and nothing showing up on the router / firewall logs, what could be doing this?
Is there any kind of super admin access that can be shut down?  I am not sure if one exists, I have heard it rumored and never thought it true but another web developer and I have started to wonder.  If I leave the network in public mode, it seems
to have something happening that slows the system but what I described above happens after the network is put into home mode so I can access my home network.
Also if anyone knows how far can I track this MAC address past just the Apple Manufacturer?
Is it possible to spoof the Connection Type on the logs of routers?  This really concerns me as it seems they were in or under my home to do this.

Answer 1

The de-facto move is to re-image, as you can never trust an infected machine after compromise. However, first we must identify what is compromised and the vector the attack took. So are you noticing this activity on only one machine or all machines? A
MAC address can be spoofed and really means nothing in this situation.
The first step is to kill network access. If you can kill internet access temporarily I would do so. You can do this on individual host machines or for the entire network. What router are you using? Is the firmware up to date? Is WiFi enabled? Have
you changed the wifi password yet? What type of encryption are you using on wifi?  Do you have WPS enabled? What traffic do you allow in and out? 
Next we must identify vulnerabilities on your host machine. A good start is to run MS Security Baseline tool, found here http://www.microsoft.com/en-us/download/details.aspx?id=7558 Common weaknesses are default password and accounts being enabled.
However, if the compromise has already taken place, the method of entry matters little at this point. Various persistence methods can be implemented on the compromised machines to ensure access is maintained after you apply mitigation to vulnerabilities. It
is fairly elementary to bypass most security software that uses a blacklist approach. Again, re-image is the best option if you can do it.
If you can't re-image run an assortment of scanners, and report what their findings are. Again, if they come back empty handed this is no guarantee of your security. Investigate running processes and services, using task manager or process explorer. Look at
a log files with event viewer, if they haven't been deleted yet. After you sort this out, through removal or reimage, I would suggest installing MS Enhanced Mitigation Toolkit. Its found here http://support.microsoft.com/kb/2458544, and make sure it is
enabled for all document, email, and network applications.
Also, I noticed you mentioned an FTP program. FTP is plaintext traffic, so credentials can be stolen easily once someone is on your network. Depending on the account running the ftp program it may be possible to compromise the machine that way, as well.
I doubt your attacker is that sophisticated, though. SCP is a better alternative, but this is really a secondary issue.
Another side point, if you know who is hacking you consider legal action. It is a felony to hack devices you do not own or have been given explicit permission to hack. How do you know who is hacking you?