Intel thermal throttling and thermal shut down are based on the peak core temperature. The temperature that AI Suite reports does not come from the core temperature sensors. When running Prime95, your peak core temperatures can be 20C higher than what AI Suite is reporting. Temperature information from AI Suite is obviously useless.
With AI Suite reporting 87C, it is very likely that your peak core temperatures are hitting the 105C thermal throttling temperature. Yes, your CPU is getting that hot. That's probably why it is slowing down when fully loaded.
During one of your torture tests look in the RealTemp Thermal Status area. When it says OK, that means your CPU did not reach the thermal throttling temperature. If it says LOG, that means your CPU logged a thermal throttling episode. When it shows HOT, that means thermal throttling is in full progress, trying to save your CPU from a melt down.
Here's an example of what a HOT CPU looks like after 3 hours of running Prime95 with the CPU fan turned off.
http://img11.imageshack.us/img11/276/hote8400fw5.png
The CPU was still running fine but you do not get its full performance when it is throttling.
RealTemp T|I Edition
http://www.overclock.net/t/1330144/realtemp-t-i-edition
The default multiplier for a 3770K is 35. For the CPU to go beyond this multiplier, Turbo Boost has to be enabled within the CPU. Some motherboards might make you believe that you can go higher than 35 with Turbo Boost disabled but what the bios does in the background after you push Save is it turns Turbo Boost back on. There is no other way so I suggest that you just enable Turbo Boost in the bios.
Enable a system tray temperature icon in RealTemp and then right click on it and open up the Power Limits... menu option. It will show you if your Turbo Power Limits are set appropriately for full Turbo Boost. Depending on your bios settings, AUTO might mean that this is only at 77 Watts which can prevent full Turbo Boost. The performance setting is 255 - 255. This won't let your CPU consume 255 watts but setting it like that ensures full Turbo Boost, even when fully loaded.
When setting up a new system and trying to find out what a CPU is capable of, I would use a fixed voltage. I would not use Offset Mode until I knew exactly what a CPU could run at and how much voltage it needs. I would also never use the AUTO bios setting for the core voltage.
It looks like your heatsink is not working as intended. You need to get your CPU running much cooler. Make sure you follow the heatsink paste manufacturer's recommendations when applying thermal paste. The microscopic pea method that is widely recommended is sometimes not enough and can cause the overheating problems that you are having.
Here is what Arctic Silver recommends.
http://www.arcticsilver.com/intel_application_method.html
The Asus bios has a great feature where you can take screen shots of all your bios settings and it will save them to a USB memory stick. I will go check but I think you need to push the F12 button. You can keep your cell phone in your pocket next time you want to share a bios pic.
