I have also had the same issue with the phone going dead but keeping the connection...It usually came back within 30 seconds. I tried the 4.2 versions from Venezuela and the Optus version. I had lag issues too just like most others with the 8700g.

I have since uninstalled both versions and went back to my trusty cingular version listed in my signature. That is the most stable OS that I have used on my 8700g. just my .02