I had to move the AP much closer to the PS3 and connect it via ethernet cable.
These are the scenarios and the performance observed.
- PS3 and computer via wireless, just those 2 devices with strong signal, encryption is WPA-PSK TKIP and no other applications are using the network: 800-900kB/s (7200kbps or 13%).
- PS3 via ethernet 100 Full duplex and computer via wireless, once again those are the only 2 active devices on the network, strong signal encryption is the same: 2.1MB/s (16.8Mbps or ~30% of the bandwidth).
After seeing the incredible difference I went to do some little research and found that wireless operates in half-duplex mode, I thought it had sub-channels for Tx and Rx but that's not the case.
Even with a steady 2.1MB/s rate I'm still seeing the occasional judder and audio drop at high rates. I managed to watch a 1280x720 AVI file with little interruption, but I don't think the network could handle 1920x1080.
Moral of the story, DLNA via wireless is not good yet, at least in the high def department. I don't think even the N standard will be able to cope with it and in order to get ethernet 100 performance you will need a wireless standard that is at least 700Mbps, i.e. 700/2 * 0.30 = 105.