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I split you off the other thread to make it easier to track for me.
Very important to close everything in the background, when we figure out what it is we can add things back if you like. Especially make sure you have musicmatch shutdown.

The other thing is trying different video settings. (refresh rates)

So follow these steps first:
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.
4) Update your Windows, update your Video card drivers and audio card drivers. Then repeat steps 1-3.
5) Adjust your refresh rate and try different ones.

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.
 
Well I see you have not done #2.
Also can you tell me a bit about your video set up, do you have two video cards?
 
You have to let me know if you are not following the advice I give you otherwise I assume you have done it and we end up going around in circles. :)

So please try the 5 things I recomended above, in order and keep them done.
Except add 4B) rename your music folder.
Then let me know which refresh rates you tried under #5
 
It is not unfixable since I and 99% of the people do not get this flicker.
We just need to find the source of the problem.

I also see you are useing VIA drivers, unfortunately these are known to be buggy, if you were running ME or 98 you could change to the native windows drivers, but no such option on XP, so the only thing you can do about that is always make sure you have the latest version downloaded and installed. I would try that first, sorry I did not notice that before.
 
Well the VIA drivers IMHO are riddled with bugs, the main one is infinate loop which is not the case here but you should have somebackground info on this as it may cause problems for you with any app.

The following was posted in one of the support forum and I am sorry to say I lost the atribution although I assume it was jpd since he is my resident expert on this.
A brief explanation maybe in order about what is going on:

The AGP portion of the northbridge maintains a command/data queue for pending transactions, which works both ways. AGP transactions are always 64 bits. The problem starts when the software initiates a transfer starting on an odd DWORD boundary. The transaction must be completed in two cycles instead of one.

When, after the first cycle is complete but before the second cycle starts, the AGP card itself also request a transfer transaction, and this transaction for some reason requires the one from the CPU to be completed first, both transactions deadlock each other.

The interrupted transaction can no longer complete, as the video card will reject it, pending completion of it's own transaction. The AGP card's transaction cannot complete either, as it requires completion of the one initiated from the CPU. Because of the bouncing of the second part of the split CPU transaction, Microsoft has named this problem 'infinite loop'. Because of the lockout in the northbridge of the chipset, the processor is permanently locked out of all memory access, and thus cannot execute any other instructions, nor can it respond to interrupts. This will cause a soundcard to repeat it's last loaded sound fragment ad infinitum, for example.

Intel has documented this particular sitiuation in it's official AGP specification, with an explicit warning to software/driver developers to make sure the above described situation is to be avoided at all times, as it will completely freeze the system. It can be avoided completely by assuring that software drivers initiate memory transfers on even DWORD boundaries only, as the AGP transaction will then only need one uninterruptable cycle and thus avoids the deadlock situation. Unfortunately, the VIA programmers haven't made sure their drivers follow this advice.

looking again you seem to have a mix, can you tell me what you have hooked up to your system, make and model of keyboard/mouse, anything external to start with.
Do you know th emake and model of your motherboard? it may be on the bill.
 
Castellon said:
Especially make sure you have musicmatch shutdown.

From my very first post in this thread. ;)
Even before I mention drivers. :)
 
What you did not belive me, when I posted it in the second post of this thread. :)
 
Do you mean to say when you shut down the program it leaves processes running.

That is the definition of shut down, end all processes the program is using.
 
Castellon said:
You have to let me know if you are not following the advice I give you otherwise I assume you have done it and we end up going around in circles. :)

Once again. :) If you look at post two