Load testing a website

I am currently writing a small application to load test a website and am having a few problems.

List<string> pageUrls = new List<string();
// NOT SHOWN ... populate the pageUrls with thousands of links

var parallelOptions = new System.Threading.Tasks.ParallelOptions();
parallelOptions.MaxDegreeOfParallelism = 100;
System.Threading.Tasks.Parallel.ForEach(pageUrls, parallelOptions, pageUrl =>
{
    var startedOn = DateTime.UtcNow;

    var request = System.Net.HttpWebRequest.Create(pageUrl);

    var responseTimeBefore = DateTime.UtcNow;

    try
    {
        var response = (System.Net.HttpWebResponse)request.GetResponse();
        responseCode = response.StatusCode.ToString();
        response.Close();
    }
    catch (System.Net.WebException ex)
    {
        // NOT SHOWN ... write to the error log
    }

    var responseTimeAfter = DateTime.UtcNow;

    var responseDuration = responseTimeAfter - responseTimeBefore;

    // NOT SHOWN ... write the response duration out to a file

    var endedOn = DateTime.UtcNow;

    var threadDuration = endedOn - startedOn;

    // sleep for one second
    var oneSecond = new TimeSpan(0, 0, 1);
    if (threadDuration < oneSecond)
    {
        System.Threading.Thread.Sleep(oneSecond - threadDuration);
    }
}
);

When I set the MaxDegreeOfParallelism to a low value such as 10 everything works fine, the responseDuration stays between 1 and 3 seconds. If I increase the value to 100 (as in the example) the responseDuration climbs quickly until after around 300 requests the it has reached 25 seconds (and still climbing).

I thought I may be doing something wrong so I also ran Apache jMeter with the standard web test plan setup and set the users to 100. After about 300 samples the response times had rocketed to around 40 seconds.

I'm skeptical that my server is reaching its limit. The task manager on the server shows that only 2GB of the 16GB is being used and the processor hangs around 5% effort.

1. Could I be hitting some limit on the number of simultaneous connections on my client computer? If so, how do I change this?
2. Am I forgetting to do something in my code? Clean-up/close connections?
3. Could it be that my code is OK and it is in fact my server that just can't handle the traffic?

For reference my client computer that is running the code above is running Windows 7 and is on the same network as the server I am testing. The server is running Windows Server 2008 IIS 7.5 and is a dedicated 8-core 16GB RAM machine.