Bit of an update.... I brought a mates PS3 over to my house and hooked it up to the tv and the internet connection once again dropped.
A while later, I reconnected my ps3, turned it on, went out of the room for 15 minutes. When I came back the internet was still on. Great I thought, however I was getting not audio or video. So I looked at the back of the ps3 and what do you know the HDMI cable was out. I plugged it in, and the internet went (weird or what?)
So I tried using the AV Composite cable and the connection went again.
I thought the HDMI/AV comp cable only transfers audio/video from the ps3 to the tv??? Why are they interfering with my internet?
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