Overlay renderer is broken

[TheLazy1]

When watching videos at my monitors native resolution the screen is distorted horizontally.
It's hard to describe but its like each line being offset by a random amount every frame.

From what I can see it has to do with scaling to my monitor's native resolution of 1680x1050.
In windowed mode it works perfectly but the second I go fullscreen the horizontal distortion happens.

Disabling scaling allows fullscreen to work but the video is centered at it's normal size.
Lower resolutions do not have this problem but any resolution besides the monitor's native one looks terrible.

All of the other renderers I tried are either too slow or have the same problem.
I tried VLC, KMPlayer, Media Player Classic and Windows Media Player.

[jagabo]

Sounds like a driver problem. Update to the latest WHQL certified driver for your graphics card.

[TheLazy1]

I was using the latest driver from nvidia, I even downgraded to 175.16 to see if that would help but it did not.
I will try cleaning and re-installing the latest driver again though and see if that helps.

[nitro1973]

Whats your graphics card model?

You can try Splash, maybe this will work.

[TheLazy1]

It is an EVGA FX5200 with 128MB, since the case only fits low profile cards this is pretty much all there is.
I'm not sure if a 6200 would be any better, or if there are any better cards that would do the job.

I can try that player later on if I decide to try a windows reinstall but what I found is that all the players I tested were fine.
It's only when the overlay renderer (fastest, looks the best) is used and is in full screen mode distortion appears.

To be more specific, the distortion only happens when scaling is applied in full screen mode.
If you disable scaling and leave the video centered/whatever fullscreen mode works fine.

[Added]
Supposing this does not get resolved, either by card defect or driver issue.
Would a PCI card to a good enough job to accelerate mpeg-2 and (possibly) HD video?

I'm guessing no for HD, but it's not too important.

[Added again]
Seems this guy has the same issue: http://forums.nvidia.com/index.php?showtopic=36114
My screen looks exactly like that.