Constant disconnect.EndofStream

I'm trying to run a server from Rackspace cloud and currently I have one setup to use 1GB of RAM. I've been keeping 10 players on the server and right about this point my console becomes flooded with "Couldn't keep up!" messages followed by total player disconnections.

I run little to no plugins and have been experimenting running with none and I still get these server crashes.

Command line startup:

Code:

java -server -d64 -Xmx1G -Xincgc -XX:+UseConcMarkSweepGC -XX:+UseParNewGC -XX:ParallelGCThreads=4 -XX:+CMSIncrementalPacing -XX:+AggressiveOpts -XX:+CMSParallelRemarkEnabled -XX:+DisableExplicitGC -XX:MaxGCPauseMillis=500 -XX:SurvivorRatio=16 -XX:TargetSurvivorRatio=90 -XX:+UseAdaptiveGCBoundary -XX:-UseGCOverheadLimit -Xnoclassgc -XX:UseSSE=3 -XX:PermSize=128m -XX:LargePageSizeInBytes=4m -jar craftbukkit.jar nogui

The CPU is a Quad-Core 2.2GHz AMD.
RAM isn't an issue, but I have it setup to use 1GB right now.
I'm hosting from Ubuntu 11.10 64-bit.
Running craftbukkit-1.2.4-R1.0 RB

java version "1.6.0_26"
Java(TM) SE Runtime Environment (build 1.6.0_26-b03)
Java HotSpot(TM) 64-Bit Server VM (build 20.1-b02, mixed mode)

Do you think my CPU is bottlenecking? I see it spike from 50-114 using the TOP command with RAM sitting around 70% used.

The server isn't really printing any other errors either.

One unexplained error I got recently was:

Code:

2012-04-02 20:36:30 [SEVERE] java.io.IOException: Bad packet id 72
2012-04-02 20:36:30 [SEVERE]    at net.minecraft.server.Packet.a(Packet.java:75)
2012-04-02 20:36:30 [SEVERE]    at net.minecraft.server.NetworkManager.h(NetworkManager.java:149)
2012-04-02 20:36:30 [SEVERE]    at net.minecraft.server.NetworkManager.c(NetworkManager.java:268)
2012-04-02 20:36:30 [SEVERE]    at net.minecraft.server.NetworkReaderThread.run(SourceFile:76)
2012-04-02 20:36:30 [INFO] /xx.xxx.xx.xxx:35627 lost connection

I'm trying my best to keep a stable server and keep my sanity at the same time! Any tip/help on configuring the server/advice is much appreciated.

P.S. I had one kid tell me to go with a specialized minecraft server host because they have boxes "Super configured" to run minecraft/bukkit better. Any idea on the truth/logic behind this statement?

 

Any mods that your players are using?
Looking later at that, I'm at school atm.

 

I don't know? I doubt it other than custom texture packs? The server is Vanilla Bukkit.

 

As far as I know, bad packet ID is mostly a player with a different minecraft version trying to join.