I replcaced my CPU the other day and so of course LFS reverted back to demo mode, and unfortunately my internet wouldn't work so I couldn't unlock it, so I played in demo mode for a while. What happened though was the framerate seemed to 'stick' at various points. The framerate limiter was off and I normally get around 100fps, however the fps seemed to 'stick' at 64fps, or with a full grid, 32fps.
The specs that matter are: Athlon 3200+, GF6600GT, 1GB Dual Channel DDR 400.

When I unlocked it to s2 again, everything was fine and the fps jumped back up, and was constantly varying.

Anyone else have a similar problem?

Turn off vertical sync

No it wasn't on, there where NO limiting factors at all, when I unlocked it changed, with no change to options at all. And anyway vsync wouldn't make it act like that, it was sticking to square numbers: 32 and 64, never saw 16 but i presume it would do that too. Very weird.

What refreshrate does your monitor have?

Such behaviour is extremely common to vsync, and just turning it off in LFS may not change anything at all. Try turning it on and off and see if you can find a difference, if not, you have to disable it from your drivers.

75hz. As I built and set up this pc myself I know what the settings are and vsync ins't on anywhere. Note also that I didn't change any settings after unlocking. This is how it went: Played demo mode single player @ 64/32fps, went back to menu and started race again (same fps), went back to menu, unlocked, started race again and all was fine.

Hmm... should it happen again, you can also try to shift+f4 into windowed mode and back again (doing this while on the track).

I've had a simular problem when the demo came out but it would go when changing sync (didn't matter when you shut it on or of). I later noticed it was caused by the refreshrate fix I used for the Nvidia drivers.

It behaved rather funny though. After first starting LFS it would run at 90 FPS. second start went to (+/-) 45 fps and the third start went to 33 fps.