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Number of connections slow download?

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Number of connections slow download?

I've got a 2mb service and when I run speed tests I'll get what I would expect around 235kb/s. However I never got this kind of speed when downloading. I know it all depens on the server where I'm downloading from but I noticed one interesting thing. This is an example only: When I download one file at a time I might get 70kb/s so I have a lot of spare bandwith left, therefore I decide to start other downloads at the same time - each one on its own would use up 70kb/s. Theoretically 4 of these downloads running at the same time should use up all the bandwidth but it's not the case. I get a maximum of around 150kb/s . The individual downloads slow down as I start more downloads.
I use mainly bittorent client which can make more than 1000 connections to peers at the same time. Can this high number of connections can 'cause congestion' and thus slows down the download? This also affects FTP client and normal 'Save As' downloads.
I also know that SP2 for WinXP has introduced a limit for P2P connections at a given time to 10 but have fixed it to unlimited.

I hope that I made myself clear Shockedops:
Any thought on this?