I don't have any major background programs running, and it ran fine for the longest time, yet now it stutters heavily in towns and even wandering the wilderness. Yet once in a dungeon it returns to normal smooth framerate. I have a pretty good system, Geforce 8800 GTS, 2 gigs of RAM, dual core e6600 processor. I'm not familiar with the dosbox controls, so I'm not sure how to inrease or decrease the cycles or change any graphical settings.

Any help would be appreciated.

[FIXED]

I had the same problem on a very similar system to yours.
I fixed it by going into the DosBox configuration file and setting Cycles = 15000.
Go into the start menu, then select Dosbox, then the dosbox configuration, then 'edit configuration'.
You'll find an entry in this text file that says Cycles = XXXX and it will have some value where I put the x's.
Change the value here and save the text file.
That's all there is to it.

Try this value and if the game play is a bit fast then turn it down by 1000 or if it's too slow then turn it up to 16000.
You'll find the value that works for your processor.

The game runs like butter now for me...

enjoy!

Thanks, that and using the ctrl F7 and F8 key helped. I think I might have turned up the frameskips by accident.