Mouse look lags with mouse, but not with gamepad

I am creating 4 player split-screen cooperative game. In editor, everything runs smoothly, but in build turning camera with mouse (default mouse look script) lowers my fps a lot. This doesn’t happen when using gamepad. Also when I set quality to Fastest, Fast or Simple turning camera with gamepad has really high sensitivity. I’ll appreciate any help.

I am posting as an answer, but also have a few questions.

One answer:
For the sensivity issue. you may consider multiplying by delta time to ensure that your movement is based on the time nad not framerate. This is common in any movement script to reduce the difference in sensivity when the framerate may change. This may help with the change in the mouse sensivity, but there is still some other problem with the performance.

Additional Questions:
As for your framerate reduction when using the mouse, have you verified that your framerate is actually lower using an application like Fraps? Does the framerate appear to be slow, or is it actually rendering slower. If the screen is jumpy when looking, it could be the way the look script moves the camera and not the actual framerate.

Also would the framerate be slower for X and Y movement on the mouse or with all settings?