Major Drop out issues.

So I'm a pretty big champion of "if it ain't broke...", and I try to balance that with keeping somewhat up to date. Well, I've done a few minor updates over the last month or so (2.x.x - 2.x.x, minor os x updates, etc.), but something went horribly wrong, and last night at my weekly gig, from the second song on, I was having MAJOR dropout issues for the next 4 hours. I turned off wi-fi, shut down iTunes, and went from vinyl control to exclusively mixing internally. That made it go from dropping out every other song, to only happening once every 20 minutes or so.
Since I ran into such incredibly unacceptable issues, I'm going to try a major overhaul first. I'm updating to 2.7.1 from 2.6.8. Also, I'll be moving my OS up from 10.8.5 to the newest version of Yosemite, and refreshing my drivers for my DJM T-1 and audio 8.
My main question is if anyone thinks it's possibly my settings tsi or something similar. I know I've read of issues where Endo and others have mentioned backing up that file (or something similar, I'm having issues remembering exactly what it was), to a safe location and then restarting.
Anyhow, I am open to any and all feedback on the situation. While I made it through the gig, I can never have something like this happen again. It will probably get me fired.

Are you using hubs?

nope

Before you do anything you should test the exact same system with the same tracks at home and eliminate power surge issues or anything in the booth that could have been causing.

Updating to 2.7.1 and Yosemite is not going to resolve an issue if it's hardware based. Plus I'd still hold off on Yosemite anyway.

WiFi doesn't cause these kinds of dropouts anymore - it might - but it generally doesn't.

You can try backing up your traktorsettings.tsi then deleting it from your Native Instruments folder and starting with a fresh tsi (remember to back up any externally saved custom tsi) but even then the settings.tsi is either working or corrupt and if it's corrupt Traktor will not work. I've never heard of the settings.tsi being 'dodgy' - it's either good or bad.

You should run Traktor on its own - no hardware. If it's fine introduce each piece of hardware one at a time to see if that is causing it.
Replacing cables and updating drivers is essential - I guess you know all this anyway, you aren't new to Traktor, I know that.

For what it's worth I would not install 2.7.1 if you have been happy with 2.6.8 up to now.
2.7.1 brings nothing new that you need and whilst I have no issues with it you should stick with your last working version.

Were you employing surge protection?

Always have surge protection, but I'm pretty sure that's not the problem. Also upgraded to 2.7.1 already. I've been a bit panicked as it's the first time I've ever had issues like this, and with two toddlers on top of work and the holiday this week, I'm a bi nervous next Friday will be here before I know it. I'll hold off on Yosemite, trouble shoot piece by piece first, and report back tonight.

You should follow advice given by Karlos - refresh your TraktorSettings.tsi file and start troubleshooting from there.

Wish you good luck and please keep us posted!

I had the Djm T1 for years and I remember it being a rock solid setup. always try a few different USB cables. I know it's a data hog because it's running audio and midi at the same time. So always use the highest rated usb cable.

Have you changed anything on the computer recently? Anything at all?