Why do my lights flicker with my portable generator?

I live in southern Indiana, and am currently living through an awesome ice storm. Anyway, my parents bought a diesel powered portable generator. It is hooked into the main panel of the house. When you crank it up and turn the lights in the house on, they flicker, as does the TV screen. It has proper voltage on each leg of the 240. I brought my generator over and everything works fine. Any ideas?
It is an All Power Diesel 6700 watt generator. Should be about 6500 watts more than I need to keep two 100 watt light bulbs burning strong!
Runs strong, with no stalling or hiccups.
Its an All-power 6500 watt air cooled diesel generator.