Use Xfce.
In conjunction with the Best SSH options for X11 forwarding (provided by this Super User answer), I was able to achieve surprisingly good performance (and bearable!), even from Mozilla Firefox.
Test Conditions
Two host machines were used for comparison:
- an Intel Core i7 720QM @ 1.60 GHz machine running KDE 4.8.4
- an Intel Pentium 4 @ 2.80 GHz machine running Xfce 4.8
I did have a machine running GNOME 2.32 that I did X forwarding testing over LAN with, but the procedures were not intended for answering this question.
An iMac 11,2 27" was tasked with running the entire desktop workspace (plasma-desktop and startxfce4) over Mac OS X.
All machines were connected with a high-latency connection averaging about 15 ms.
Test Results
- GNOME 2.32 was painful to use, like how you were complaining. This is the baseline.
- KDE 4.8.4 was even more painful to use. I could hardly get anything done because the performance was so bad. Plasma Desktop took too long to respond to be practical. Dolphin was sluggish and exponentially so the more I tried interacting with it.
- Xfce 4.8 was actually snappy. After things loaded, performance was almost like I was directly using the machine. Thunar was highly responsive, which I didn't expect after trying out GNOME and KDE.
Test Analysis and Recommendations
The GNOME and KDE desktops had a lot of hardware advantages over the Xfce desktop. Since the weaker Xfce desktop far outperformed the much stronger GNOME and KDE desktops for X tunneling over SSH through LAN, the results are even more astounding.
You've also got a faster LAN latency than I, so it can be expected that your experience with Xfce may be even better than mine.
The cause for such a radical difference must be due to Xfce's lightweight design.
If you're looking for better performance for X forwarding via SSH, use Xfce.