Yup Kazaa will totaly scrap your connect. There were some instances where I got a ping well into the 1800's. After shutting down Kazaa my ping went to 95, maximum.
As to viruses, think about it. basically your computer is in a huge swap meet convention center filled with other computers. A few of them have the computer equivalent of SARS, or Mad Cow disease. Do you really want to go to someplace where the potential for catching something really nasty exists?
After finding a few viruses I thought that was the price I had to pay to have the entertainment I wanted, but Scrapping my AH connect was too much a price to pay. I scrapped Kazaa, besides the porn on Kazaa was really bad;)