Good chance it is the wireless, however to prove this you would need to connect up by cable and see what the difference makes? As for changing wireless channel it should be possible certainly was on the HH2 unsure about a HH3 but can`t see why not.
I play WoW as well and get the occasional latency issue but its not often.
Remember: Amateurs...built the ark.
Professionals...built the Titanic
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