high number of dropped packets

[Jacob Coby <jcoby@xxxxxxxxxxxxxxx>]

Hi all,

I just upgraded my real servers from redhat 7.3 to centos 4.2.  When I 
do a 'tcpdump port 80', I get large numbers of dropped packets.  Is this 
normal?  My users are complaining about random 'server cannot be found' 
errors.  Refreshing the page a couple of times seems to fix it for a 
little while.
Sample output on the real server:

1761 packets captured
2045 packets received by filter
170 packets dropped by kernel

I've seen it as high as 80% of the packets dropped by the kernel. 
ifconfig looks like:
eth0      Link encap:Ethernet  HWaddr 00:0F:1F:64:83:0A
          inet addr:  Bcast:  Mask:255.255.255.0
          inet6 addr: fe80::20f:1fff:fe64:830a/64 Scope:Link
          UP BROADCAST RUNNING MULTICAST  MTU:1500  Metric:1
          RX packets:56762863 errors:0 dropped:0 overruns:0 frame:0
          TX packets:52368295 errors:0 dropped:0 overruns:0 carrier:0
          collisions:0 txqueuelen:1000
          RX bytes:1314052482 (1.2 GiB)  TX bytes:2879436004 (2.6 GiB)
          Interrupt:193

lo        Link encap:Local Loopback
          inet addr:127.0.0.1  Mask:255.0.0.0
          inet6 addr: ::1/128 Scope:Host
          UP LOOPBACK RUNNING NOARP  MTU:16436  Metric:1
          RX packets:204 errors:0 dropped:0 overruns:0 frame:0
          TX packets:204 errors:0 dropped:0 overruns:0 carrier:0
          collisions:0 txqueuelen:0
          RX bytes:983393 (960.3 KiB)  TX bytes:983393 (960.3 KiB)

lo:1      Link encap:Local Loopback
          inet addr:VIP1  Mask:255.255.255.255
          UP LOOPBACK RUNNING NOARP  MTU:16436  Metric:1

lo:2      Link encap:Local Loopback
          inet addr:VIP2  Mask:255.255.255.255
          UP LOOPBACK RUNNING NOARP  MTU:16436  Metric:1

ifcfg-lo:1 looks like:

DEVICE=lo:1
IPADDR=VIP
NETMASK=255.255.255.255
NETWORK=<netmask>
ONBOOT=yes
ARP=no

/etc/sysctl.conf has:
net.ipv4.conf.lo.arp_ignore = 1
net.ipv4.conf.lo.arp_announce = 2
net.ipv4.conf.all.arp_ignore = 1
net.ipv4.conf.all.arp_announce = 2

I'm running LVS-DR.

Are dropped packets normal now?  I never had them when running on redhat 
7.3.  I've checked the DNS servers, and they seem to always respond 
correctly, so I can only assume it has something to do with these 
dropped packets or some other configuration error.
--
Jacob Coby