Huge number of blog users

I have more than 39,000 blog users.
I recently upgarded to WPMU 3.1 from a very old WP (guess 1.0 or pre release version).
As expected, the upgrade resulted in having more than 210,000 tables in WPMU database.
I have 2 Front-End servers and 1 DB server. My servers experiences a load in excess of 40 concurrent users.
Issues:
1) When released to production traffic, both front-end and DB servers crashed within 5 min. Old WP setup used to take a long time to load but never crashed.
2) Caching plugin doesn’t work as I don’t want to use parmalinks.
3) Due to the huge number of tables MySQL takes a long time to open using Workbench.

Please sugguest what settings should I be doing to stablize the environment and make sustain the load.