Kazz, you were doing fine on your part. The technical problems cascaded, and people began to care less as a result, because they didn't know if or when their intent to do things would get through.
Let me say that again, you were doing your job as DM.
The game itself:
The encounter was a folly on our part for a few things. Turns out Burrito had Draconic all along, but due to techincal issues, didn't get a chance to convey that on anything more than one line, which I didn't interpret as 'I have draconic'.
The infinite hallway and disapearing ceiling hatch are fine solutions to the problems explored in game (And that I asked about outside of the game). I'm still not sure why the dwarves are enamored with the two-type rock wall and cutting out new rooms to live in when they could be pushing their work upward, but I will drop the subject for the sake of simply playing out the dungeon as intended.
The actual battle results could not have been predicted. The foe was unknown, so we just figured just split up and drop them. Not only did they have action points, but apparently upon bloody status they copy themselves and do just as much damage as they did before, and had a fairly good to-hit value, good damage, and ongoing damage. They were designed to tear us apart if we used the strategy that we ended up using. Sadly there were no clues at all prior to combat with them on what to expect. This happens. It's D&D. I think most of us should have scars from that fight.
As for zany crazy 'I'm gonna learn you a book' guy, I would expect nothing less from Kazz. :D
I'm just sad that him yelling in my ear doesn't provoke. :(
The technical issues:
I am not 100% certain, but the old gametable had issues when a lot of lines were drawn. It does not matter if they are later erased, it just begins this psycho decent into both connection problems and memory leaks. The overzealous pony drawing contest MIGHT have been a factor. The last group I had that used GT ran into this problem with the GM drew out some kind of dungeon that literally translated to about 12 x 12 feet of hidden lines.
Let's try rotating the host, or use a host that is as best as possible to being the geometric center of our group of players.