I have an ASP.NET 2.0 page whose UI controls are significantly slow. 

This is only in IE 7. Firefox 2 responds substantially faster. Albeit, a good solution would be to not use IE, but, our clients use it, so, we have to find a solution or palatable work-around.
I want to point out and emphasize that the slowness is after—not while—the page loads. So, this is apparently a client side issue.

The slowness manifests itself when a user

1. clicks on the checkbox controls, they show/hide the check mark very slowly
2. selects drop down list controls
   they open up relatively quickly (still slow), but response time is slow when the user scrolls down the list or hovers over items to highlight them; some drop downs have as little as 15 items and some have at most 60 to 80 items.
3. simply scrolls the page itself.
   

Slowness is in the order of 4 to 8 second response time running on a local development environment.  It is reproducible and was found on a production, distributed environment.

The slowness is most noticeable when the page is displaying 50 or 100 records. Number of records can be changed with the drop down at the bottom of grid.

The problem description is pretty intricate and is fully described at http://blogs.collaborare.net/blogs/post/2008/03/ASPNET-Page2c-Client-Side-Slowness-in-IE-7.aspx

Please feel free to comment on the blog and/or here, whatever is most convenient.
 

Many thanks in advance! 

Do you have compilation debug="true" set in your web.config?  In a production environment this should be set to false.  This will speed up the operation of the client-side code and allow the javascript support files to be cached by the browser.  If you've not already done this, you will notice a significant performance difference.

Hope this helps.