Items or Enchanted Items cause lag.

I am creating an Open PvP map on a superflat world. I have noticed some lag issues while playing it with some friends.

Basically, how it works is, you step on a pressure pad, it teleports you to a chamber, and using dispensers and command blocks gives you full protection I iron armor, a sharpness I diamond sword, a power I bow, one arrow and a golden apple.

The problem seems to be that while running around with those items in your inventory, my frames drop down, along with various other friends and the game seems to be choppy. I know the items or something around the items are causing the lag because as soon as I clear my inventory the lag disappears and I am back up to running normal frames.

I do have several clocks running on the map so I tried destroying them completely and still get the lag issues.

Can someone verify that this is indeed a bug? Thanks!