Changed MyISAM to InnoDB, huge performance loss
You said in your question


  I've read if you have a lot of INSERTS / UPDATES with big data InnoDB is way better then MyISAM. I'm not sure what I'm missing here.


Your server class is too small for your InnoDB settings.

On Apr 14, 2011, I mentioned how the storage engines have distinct ways of caching.


MyISAM will only cache indexes in RAM. Data is always read from disk.
InnoDB caches data and indexes in the InnoDB Buffer Pool


I also noted how your innodb_read_io_threads and innodb_write_io_threads are maxed out. You only have 4GB of RAM or which you only have 1GB free (due to your 3GB or 3072M Buffer Pool). I would lower your threads from 64 to 8.

If you have the budget, you should go upgrade your server class to m3.large or m3.xlarge where you can have 4 CPU and 15 or 16G of RAM. You could then increase innodb_buffer_pool_size to 10G or 12G. Then, your remaining InnoDB settings would make sense. I would still lower your threads from 64 to 8.