I can't find it at the moment, but I distinctly remember reading about this either on this thread/forum or some other forum (maybe CNet). I had the exact same problem as you and I don't know if there's any merit to it, but it seems to have fixed the problem (for me).
I was told to put any gaming console on the 1st input. You know how there's 3/4 different HDMI inputs? Supposedly the 1st one has "less lag" than the others. That in combination with Game mode supposedly fixes the problem.
Again, I can't find where I read it at the moment, but that fixed my lag issue. Maybe try that.
Game mode brought it down under 50ms, but PC mode got it to 0. These measurements were taken using guitar hero so its not entirely accurate. To put it into PC mode I had to rename the 1st input to PC and then when you go into the game mode option it is greyed out, but you lose a lot of the customization options. I'm going to buy a hdmi switch so I can put my 360 and ps3 on the same input and not have to deal with this again.