choppy playback

[eon]

I recently bought a new computer and started to play divx/xvid/mpeg files and they were choppy and distorted. I tried a bunch of things and thought it may be the codecs but the codecs are fine. After trying a million things and losing it, I decided to turn down the hardware acceleration in the display settings. That worked and I can see the videos without distortion, but they look like crap without the hardware acceleration (So Bad that I'd rather not watch the movies that way). So I had to put the hardware acceleration back up. I downloaded Virtual Dub and loaded the videos in (with hardware acceleration FULL) and the videos looked fine within Virtual Dub, however, when I try to play them on Windows Media Player or the DIVX 5.02 Player or BSPlayer they have this distortion to them. Has anyone had this problem, does anyone know how to fix it? Note: I have a Pentium 2.8GHz, Raedon 9500 PRO, Sound Blaster Audigy 2, and a Planar Monitor. I'm sure all the drivers are in correctly because I did the Microsoft DX diagnostics test and every test passed (Direct Draw, Direct X, and Direct Sound). Any help is appreciated.

-eon