try Hacking in an AutoResetEvent to control the outgoing UDP loop instead of a continuous loop with sleeps.

Does appear to have a cpu impact but may need further tweaking

OpenSim/Region/ClientStack/Linden/UDP/LLClientView.cs

@@ -3776,6 +3776,17 @@ namespace OpenSim.Region.ClientStack.LindenUDP
                 ResendPrimUpdate(update);
         }
 
+//        OpenSim.Framework.Lazy<List<ObjectUpdatePacket.ObjectDataBlock>> objectUpdateBlocks = new OpenSim.Framework.Lazy<List<ObjectUpdatePacket.ObjectDataBlock>>();
+//        OpenSim.Framework.Lazy<List<ObjectUpdateCompressedPacket.ObjectDataBlock>> compressedUpdateBlocks = new OpenSim.Framework.Lazy<List<ObjectUpdateCompressedPacket.ObjectDataBlock>>();
+//        OpenSim.Framework.Lazy<List<ImprovedTerseObjectUpdatePacket.ObjectDataBlock>> terseUpdateBlocks = new OpenSim.Framework.Lazy<List<ImprovedTerseObjectUpdatePacket.ObjectDataBlock>>();
+//        OpenSim.Framework.Lazy<List<ImprovedTerseObjectUpdatePacket.ObjectDataBlock>> terseAgentUpdateBlocks = new OpenSim.Framework.Lazy<List<ImprovedTerseObjectUpdatePacket.ObjectDataBlock>>();
+//
+//        OpenSim.Framework.Lazy<List<EntityUpdate>> objectUpdates = new OpenSim.Framework.Lazy<List<EntityUpdate>>();
+//        OpenSim.Framework.Lazy<List<EntityUpdate>> compressedUpdates = new OpenSim.Framework.Lazy<List<EntityUpdate>>();
+//        OpenSim.Framework.Lazy<List<EntityUpdate>> terseUpdates = new OpenSim.Framework.Lazy<List<EntityUpdate>>();
+//        OpenSim.Framework.Lazy<List<EntityUpdate>> terseAgentUpdates = new OpenSim.Framework.Lazy<List<EntityUpdate>>();
+
+
         private void ProcessEntityUpdates(int maxUpdates)
         {
             OpenSim.Framework.Lazy<List<ObjectUpdatePacket.ObjectDataBlock>> objectUpdateBlocks = new OpenSim.Framework.Lazy<List<ObjectUpdatePacket.ObjectDataBlock>>();
@@ -3788,6 +3799,15 @@ namespace OpenSim.Region.ClientStack.LindenUDP
             OpenSim.Framework.Lazy<List<EntityUpdate>> terseUpdates = new OpenSim.Framework.Lazy<List<EntityUpdate>>();
             OpenSim.Framework.Lazy<List<EntityUpdate>> terseAgentUpdates = new OpenSim.Framework.Lazy<List<EntityUpdate>>();
 
+//            objectUpdateBlocks.Value.Clear();
+//            compressedUpdateBlocks.Value.Clear();
+//            terseUpdateBlocks.Value.Clear();
+//            terseAgentUpdateBlocks.Value.Clear();
+//            objectUpdates.Value.Clear();
+//            compressedUpdates.Value.Clear();
+//            terseUpdates.Value.Clear();
+//            terseAgentUpdates.Value.Clear();
+
             // Check to see if this is a flush
             if (maxUpdates <= 0)
             {

OpenSim/Region/ClientStack/Linden/UDP/LLUDPServer.cs

@@ -806,8 +806,12 @@ namespace OpenSim.Region.ClientStack.LindenUDP
             }
 
             PacketPool.Instance.ReturnPacket(packet);
+            m_dataPresentEvent.Set();
+
         }
 
+        private AutoResetEvent m_dataPresentEvent = new AutoResetEvent(false);
+
         /// <summary>
         /// Start the process of sending a packet to the client.
         /// </summary>
@@ -1658,6 +1662,7 @@ namespace OpenSim.Region.ClientStack.LindenUDP
             // Action generic every round
             Action<IClientAPI> clientPacketHandler = ClientOutgoingPacketHandler;
 
+//            while (true)
             while (base.IsRunningOutbound)
             {
                 try
@@ -1718,8 +1723,9 @@ namespace OpenSim.Region.ClientStack.LindenUDP
 
                     // If nothing was sent, sleep for the minimum amount of time before a
                     // token bucket could get more tokens
-                    if (!m_packetSent)
-                        Thread.Sleep((int)TickCountResolution);
+                    //if (!m_packetSent)
+                    //    Thread.Sleep((int)TickCountResolution);
+                    m_dataPresentEvent.WaitOne(100);
 
                     Watchdog.UpdateThread();
                 }