Some people reported extreme lag while playing after B12. Check these options to be sure where the problem is:
Memory: WinXP needs 1 GB t work properly with LOTRO. Vista needs 1.5 or even 2. If you have less than this you will need an upgrade.
Disk Defrag: defragment your hard drive, that way data will be more “closer” and the disk will not need to jump all around to find the pieces of information. In extremely fragmented drives (specially if you delete and install lots of things daily) this is a must.
Delete the lotro preferences file (located in the LOTRO folder in My Documents in XP or Documents in Vista).
Reset all options to default.
Try playing with the crowd control and texture cache in the advanced options.
Turn off floaty names by hitting N
UPDATE ALL DRIVERS. Specially video and sound.
Reset your router or cable modem
If you are using a wireless connection check the signal strength.
If your Internet Connection is fine and you know your PC can handle the game quite right but you still get some lag try the two following options at the bottom of the Advanced Graphic menu (Inside Options):
Texture Cache
Player Crowd Control
Edit the file My DocumentsThe Lord of the Rings OnlineUserPreferences.ini and change:
AllowFakeFullScreen=True
to
AllowFakeFullScreen=False