Hi.. I used to have 200-300ms with tunneling service on Oceanic server..
Since the latest 4.0.1 patch.. my ping spike up to 600ms and constantly remain at that level.. sometimes even spike up to 20k ms..
I'm quiet sure there's nothing wrong with my streamyx as i can surf net smoothly and download at full speed..

anyone of you having the same issue?? anyway to solve this??   

WOW is now download something everyday to fix bugs and rubbish.
If you turn off the downloading then WOW is most likely to crash for no reason (since your version is not "up-to-date").

Sometime the whole server got frozen for no reason, no1 can do anything except the chat and it normally recover itself in 5-10mins.

Well, I would say we are now playing a BETA version where hotfix and debugging happened almost everyday.
PS: Try open Wow with the launcher and see if there's anything else to download.