I going to take a guess and say that it might be your video card, the fact that it is randomly occuring seems to eliminate the monitor.

Did this just happen?  Were you making any changes to setting or updating maybe video card drivers when this started to happen? 

Yeah, it's random--comes and goes, and sometimes worse than the picture. But I think azalia is the only one to do that too...

Thanks for the help.

I feel certain the problem is going to be your video card or drivers. Have you tried pulling the card and reseating it in the slot? Also, check and see if the fan is working on it.

I encoded this as mpeg2 at fairly standard bitrate so it should play on anything that will play a dvd. Have you tried playing the video in PowerDVD or Windows media player?

If you private message me your email address, I'll send you a copy that uses wmv instead of mpeg to see if it will run for you.

By the way, this is the first problem I've heard of on this dream and it has been downloaded over 2200 times.