Ok, This happened before I had installed anything on it. Then I put Logic Audio, Sound Forge, Reason 2.0 on it. Then I installed all the service pack, updates etc from M$.
And still it happens. I have just noticed that often the freezes happen to coincide with HD access, I'm wondering if I had some odd settings somewhere.
I have made sure the drive does not spin down (power saving), and I can't find any other cache options. I have installed the latest IDE drivers from the chipset vendors website... still the machine stutters :-(