Info on the primary key would be helpful

Well what sort of latency are you looking at, seconds, minutes? Where is the latency? That will provide a big clue, it is taking a while for your subscriber...

Take a look at http://msdn.microsoft.com/en-us/library/ms188697.aspx

Well....

There are some very important pieces of information that I think anyone is going to need in order to provide any sizing suggestions.

When you say there will be millions/billions of...

The differential backup will contain all changes since the last full backup, so logically they will get bigger over time unless you have taken another full backup.

You might want to...

A bit of a shot in the dark here but it might be worth it to.

sp_recompile on your table

and

dbcc checkcatalog

The SQL Server error log, I am curious if you are 'getting' to SQL Server at all.

How much downtime are you allowed to have?

The only thing to be mindful of, is if your target production environment is not Enterprise Edition to not use features and functionality that is only in Enterprise Edition (since...

If it is just select rights you want them to have, why not try setting those rights for a group at the schema level then put those users in that...

Well then you could look at doing a select on sysobjects, sysindexes and syscolumns that saves those results to a flat file and then compare that to your 'master copy'...

Do you still get the timeout if you run a simple select as the query? If you force a failure on login (like a bad password) do you see...

Well, do you have a holiday calendar table someplace?

If not you should be able to calculate the number of Mondays - Fridays in a SQL function. But...

Do you want to do the compare inside or outside of SQL Server? That is do you want a file you would import into the remote SQL server (perhaps...

Off the top of my head, no I don't thing there are any full blown service packs for R2