I figured this out only yesterday. But I agree, the quest helper gives HORRIBLE lag.
I can give a wonderful example, too. I had been using my quest helper in Ancient Burial Grounds. I decided to take it off, because I was going to take some screenshots. Then, when I tried putting it back on, suddenly my entire screen was going soooo slow! I couldn't even type to tell my friends what was going on. I eventually got so annoyed that I quit the game and went on my level 13 Death character, and she worked perfectly fine, even with the quest helper. I then tried my myth, and she also worked. I explained to my friends that "Sierra is broken." So I had to help my sister as an initiate... how embarrasing.
A few days later, I logged back onto Sierra. She still wasn't working. Again I was angry, but for some reason I choose to try and turn off the quest helper. It ran perfect after that. Strangely enough, after a few minutes of playing without it, the quest helper came back on by itself and worked.
So it must be triggered by turning off and back on the quest helper.
It seems like the quest helper uses some pathfinding algorithm to find the distance; it certainly doesn't use a simple straight line distance. It also recalculates constantly. Still, there are pathfinding algorithms that are polynomial time, and modern computers are powerful enough that this shouldn't bog down a computer much unless it is recalculating the distance way too often. Is the slow-down related to how far you are from the relevant quest?