Bad Video Driver or Card

Okay guys, here's the thing...

I bought a new ATI Radeon X800 GTO PCI-E and I have just poped it in and im trying to work it.

I installed the drivers that came with its CD and it started showing black boxes around my screen that disappear and appear as I move my mouse over them.

I tried installing the latest drivers from the ATI website and it makes everything better until i restart the computer. I also downloaded and installed some ATI OMEGA drivers that I heard about, but same thing. Sometimes it gets so bad, my screen freezes turns black a few times and comes back with worse colours or sometimes it gets so bad it crashes the PC.

I have tried many things and it's driving me crazy. My friend suggested it's a hardware problem but the graphics card is new and i wanna try different things before i believe my card is stuffed.

Thanks in advance guys.

I used the ATI 6.10 Catalyst driver and the Omega 3.8.330 Driver.
Any ideas???