One thing you could do is upgrade to the 1.00.04 version. I reworked the synchronization code to make it more efficient. However that said, I think 2-3 seconds isn't going to be possible if you're going to use synchronization (having it checked under Admin->Authentication). I don't know if it's just the time it's taking to pull the information out of the AD, if it's IIS's Windows Authentication, a combination of them both, or something else entirely. I did do some Fiddler tests in July or August and the actual authentication was only taking 2 or 3 milliseconds.

I have compared it against Plumtree (a commercial application) which the college I work for uses for its main website. The total login time difference for Plumtree was roughly 5 seconds vs. DNN which was taking 6-7 seconds. I do have some more tests to run on the site but have been hampered for testing time due to other work commitments. If anyone has pointers I'm more than willing to listen to them.