The process of going from/to the same disk, is like the slowest of all, at some point the cache is not going to be effective, and it is trying to read and write at the same time. Having a second disk could really help, then to layout your system so that your From-To is on the other drive. That also can explain why any other disk activity is very slow, any activity requiring the disk is going to be slow. In fact the faster your copy is going saturating its ability the more likely other disk activity is slowed.
Assuming windows the program "FastCopy" not only will buffer more data into ram during a Single disk operation like this, reducing the strain on the I-While-O problem, but it also has a throttling feature, a few notches down from full speed could get the rest of the disk activity some time slices to operate in.
I would recomend fastcopy, being carefull about how you install it and set it up, so you can use it optionally. There are things that the normal system can be faster at.
Recommend it again, in this situation because it has a "compare" capability, taking lots of extra time to compare, it could show if something else was going wrong.
The more fragmented and the more seperated the data is on the platters, the longer it is going to take also. The more data fill you get the slower it will be also, as the 2nd half (approx) of the hard drives can be fully 1/2 slower than the first half.
If you get a Backup first, then defragmenting the parititons or at least understanding the fragmentation and location of the data could be useful. The program "MyDefrag", running an Analise Only script can show you things, sometimes you might be better off not seeing :-)
In situations like this there might be way more to why it is slow. You should monitor activity closer, possibly check for virus, Do a smart test on the drive, uninstall junk programs, and check with any added stuff you installed turned off. Do not make any assumptions that what I have written is a total answer.