They seem to be ok then suddenly peak causing the system overload.
Well, which is peaking, the disk, or the cpu, or both?
If the disk is peaking, freezing won't help because freezing reduces the CPU load but increases the disk load. Unfreezing reduces disk load but increases CPU load.
Is there any way I can improve my settings or working method to rectify this?
Again, it depends where you bottlenecks are. If your issues are disk related, and you don't say what your disk setup is or how hard your working the disk (ie, audio tracks only, or lots of streaming sample usage, or both etc), and what speed and interface your disk is on, but you want interfaces with a high bandwidth eg FW800 or ESATA, and fast drives (7200/10Krpm), and possibly to spread the load over multiple drives to lessen the load on each.
If CPU is your issue, then you need to look at your plugin/instrument usage. Perhaps render/bounce out some to plain audio files. Use larger buffers too. But your CPU can only process a certain amount of data in real time - if you are asking it to do more than it can do, it's going to stop. You have to work within your resource limitations.
Also, check how much ram you have - if you have a small amount of ram, this will cause more bottlenecks too.