Just recently installed LimeWire. Went for a few files and they downloaded in seconds, I was quite impressed. Started going for more and since then they just connect and queue, maybe one actually starting to download. The speed sits at 1 or 2 KB/s and shows over an hour to download the file..but my connection icon in the bottom shows full green bars. I haven't changed settings since first downloading LW and getting those first files in under 30 seconds, what has happened?

(running windows XP home, if it matters.)

Download a file from here & see what speed you get
http://www.magnetmix.com/video.shtml

Who is your ISP?
Do you see the firewall icon (brick wall in front of the blue globe)?

When downloading a video off of that site: Speed started low around 15KB/s but rose up to 160's KB/s.

ISP: SBC Global, I've never had problems with connection. Play XBOX live and Counter-Strike never experiencing lag. (lol best way to describe it)

Firewall: No, just the globe. Use McAfee, and have added LW to the granted lists when that box pops up.

That all looks ok & AFAIK SBC Global aren't throttling p2p

Your download speed depends on a lot of things (your connection speed, host's connection speed, how many upload slots the host has open, whether you're downloading from single/multiple hosts, network congestion etc etc).
Some hosts have a slow connection or heaps of upload slots open, in that case your download speed's just going to be slow.

Have a look through the thread below. The first few posts have some good tips for optimising your LW's performance
Configuring LW for best performance