There is a bit of a limitation in Microsoft .net in how large an embedded resource can be in a .NET assembly. This affects SQL Packager because this is how the scripts are saved into the executable. The maximum size is 50MB, so any package larger than that will start producing dlls that are just full of data, but the main executable will remain small.
I can't say for sure why the package would run any slower, except that you're possibly running low on memory. Hopefully it's something as simple as that.