Small number of concurrent users bringing down WPMU

We had a teacher teacher add ~100 new user accounts using the plugin: Blog and User Creator.

Today when a class of those students (~30) logged on and tried to reset their theme to Atahaulpa 3.2.2 it brought the entire WPMU implementation down.

None of this seems to be sufficient to cause the catastrophic failure we are seeing. The processor usage is not high and the database server des not appear to be having issues. Any thoughts?

Ver: 2.8.6