You may want to try out the Incremental Preview extension, which causes the preview to update only the paragraph you are editing rather than the complete answer. That may help with the problem you are having.
Having tracked this issue since it first appeared, it is more complicated than your posting suggests, and it is not clear that either of your first two suggestions (about timing of preview updates) would resolve the issue. Indeed, an earlier version of the previewer used a pause before updating, and that met with considerable complaint.
I have been unable to reproduce the issue (ever) with current versions of Chrome in Windows 7. From the reports of those who do experience the problem, I am convinced that it is a memory management issue within Chrome (or perhaps Windows itself), not a bug in MathJax, although it is certainly the case that the heavy load put on the browser by the use of MathJax in the preview is producing the conditions that trigger the bug. It may be possible to change MathJax or the preview code in some way to avoid the problem, but without a reliable way to reproduce it (and I haven't even reproduced it once), I would just be shooting in the dark.
You mention the preview "slowing the process down to a crawl", but I also have not experienced that. The way the current preview works is that the preview text is replaced at each keystroke, as you suggest, and MathJax is started, but the next keystroke should interrupt MathJax so that you don't have to wait for additional math to be typeset (past the expression currently being typeset). My experience is that that is pretty snappy. The length of the answer should not really be an issue with this, since it can be interrupted at any point. (Of course, how much of the math get typeset before the interruption is dependent on the length.) If that is not what is happening for you, can you describe in more detail exactly what is happening? Thanks.
My suggestion is to try out the extension I like to above. I asked for feedback from Chrome users about whether this helped, but so far haven't had any. Perhaps you could let me know if this approach helps.
You might also want to try installing the STIX fonts, or the MathJax fonts, in order to eliminate loading web-based fonts, which is one possible source of problems.