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Okay let's try some standard things.
1) Rename the AVI folder to AVI_back
2) Set the color depth to 16BIT
3) Turn off everything in the background like E-mail/ICQ/Messenger, Virus protection and everything in the system tray beside the clock
 
If you are getting memory errors report by the system then this is the forum you want to be in. But since you have the ear of a bug mod then you can do double duty just in case. ;) :)
 
Please run a DirectX Diagnostic:
Start menu –Run - then type Dxdiag, then select each tab across the top of the window, and run the tests on each tab. Then select “Save All Information” button in the lower right of the window. This will bring up a dialog box to allow you to select a name for the file where the information will be saved. You can save it right on the desktop as this will make it easy to find. Then copy the contents of that file from the start to the heading that says “DirectX components” then paste what you have copied into a post in this thread.
 
Just thought I would mention this in here as well.
jpd discovered that renaming the Tiles file will give you poorer graphics but better performance.
Something to try for the desperate.