Hi ChrisVH,
Generally speaking, when it comes to backups of a large number of small files, tests have shown that the Windows filesystem is much slower than Linux and UNIX. Thus, lowering the logging level from Log All to Log Directories will help but won't solve the issue altogether. Same applies to upgrading Data Protector to version 8.12.
I suggest that you perform a test to a local null device to eliminate the network layer completely.
The alternative approach is to perform a rawdisk backup as it will traverse the filesystem limitations. The downside, however, is that the size of the backup will be equivalent to the size of the disk/volume/partition that is backed up rather than the total size of the data on the disk/volume/partition.