Can you post servers configuration including processor and memory? Was the server slow at all before installing AD? Have you broken out the fsio roles accordingly? Are you running the applications off the server in application mode? What is slowing down? The processor or memory?
If you have a large number of users on a domain and only a single server that server will slow down. This is especially true if users are logging in and out a lot, or accessing network resources frequently as this will force a log of called to the Active Directory database which puts a workload on the disk which will slow down the machine. Also if you don’t have a lot of memory and CPU power adding any additional load to the server will cause it to slow down.
You may need to purchase an additional server in order to either run your applications or to be your domain controller.
Also, keep in mind If you only have one server you are adding a lot of other services to this server when you make it a domain controller. Kerberos, authentication, DNS, etc; not to mention the Domain roles and teh server being optimized for these roles versus file and print sharing. From a managemnet of the network perspective if you have more than a few users you really do want a domain. Workgroups are extremely time consuming with keeping local machine account passwords in sync and what not. Not to mention you get quite a few management benefits out of a domain, like Group policy and a database of information about your users that you can query with vbscript (Phone numbers, addresses, home numbers, etc)