cheesyboofs!
Problem solved!
Due to the nature of the environment I had limited time to perform thorough experiments, so I don't have anything conclusive to report, other then I have the system working.
What I did:
-I changed card to Intel Pro 100/1000 GT.
-I added a cross-over cable and changed cable port placement to new corresponding ports(8thport(A) to 8thport(B).
-I first connected the switches then turned them on, with nothing else connected - then I added the pfsense box, which had also been turned off.
At this point the whole thing works fine, clients are able to connect to captive portal quickly and download files at 2-300 kbytes, from either switch.
Another change was the uninstallation of squid as it turned out we didn't need it anyway and it allowed a means to bypass the captive portal easily.
"Also you shouldn't assume its pfsense just because it is new, unless you can put back the old modem and the speed returnes…"
Yep that's what we did. If I had time to peform experiments I think I would have found it was the old 3com card, that caused negotiation issues, that probably muddled the auto-midx mechanism.
Can't thank you enough cheesyboofs, solution to the problem and so many nice tips and tricks