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[HwitVlf]

I've never experienced this issue so it's hard to have an educated idea what causes it. RGB Emulation (aka software rendering) isn't ideal for the reasons you stated, but the fact that it fixes the issue gives a clue as to the source of the problem.

I've heard that Windows Aero causes flickering issues with some full screen programs. People have reported a fix by disabling Aero. ‎