Sounds like the kinda problem I had. Are you using Vista? Try disabling Aero and see if it persists.
Are you? Have you? Because this was the exact problem I was having and this solved it.
The FPS plummeting down to single figures then restoring to a smooth amount again doesn't sound like overheating to me. Overheating has never reduced my frames like this. It's resulted in artefacts then lockup.
If you run a game windowed, then click off it, the frame rate drops terribly in the game whilst it's not active. I'd say there's some kind of background process which is popping under and running taking away priority from the game.
Look at software, forget hardware for now IMO.