If you have a very large amount of controls on a page, you should really try to use simple controls if possible. This doesn't just apply to AJAX codes, but also with standard server controls (e.g. DropDownList vs. SELECT, TextBox vs. INPUT). In your case, I would try to limit the controls rendered at one time. One approach is to use the AJAX tab control and then load UserControls on demand, see http://blogs.msdn.com/sburke/archive/2007/06/13/how-to-make-tab-control-panels-load-on-demand.aspx
Hope this helps.
-Damien