Yeah there's noticeable frame rate issues around wizard island.I personally haven't finish the game yet myself, but I did go south (point of no return mission) and have done about 3-4 missions in the new area. The story is at its best at Iron Mikes in my opinion especially the 2nd half of Iron Mike before you ride south.
I'm actually kind of annoyed at where I am now (Wizard Island). The lag dips seem very frequent in this area. Its driving me insane.
The story is really good now. I personally didn't care for any of the boozer stuff, he's annoying