If you reinstalled and lsmod shows that you are using rt2800pci, then what does rt2860 have to do with anything? My question for you is, after you loaded the driver parameter above, what exactly is not working? Your original question says kernel panics under load. Do you have that now?
when the wifi chip gets a little bit of load i get kernel panic ive tryed this with ubuntu 12.10 and linux mint 14.