Blu-Ray Playback problems, Morphing?

Ok, so I recently bought myself a new tv so I wanted to play some blu-ray movies on it so I went and got a drive. When I play movies it looks like peoples faces are morphine or something and im not sure whats going on, the picture seems a little flatter than it should.

Here's my setup
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TV: LG 42lh30 - 42" LCD 1080p

Video Card:
Saphire 4830 http://www.newegg.com/Product/Prod [...] 6814102803
9.7 drivers for windows 7 x64

OS:
Windows 7 7100

CPU:
Intel E8400 3.0ghz

Ram:
4gb G.Skill 1066mhz

Movies:
Knowing
Push
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Using the included DVI to HDMI converter and a 6' HDMI cable. Sound over HDMI works with this setup as well.

I tried the 9.6 drivers and the 9.7 drivers and they did the same thing, I also tried a different HDMI cable.
When playing MKV files theres no problem with the morphing. Testing using 24hz and 60hz playback.

I think I got it figured out, need to test more movies though. Talked to a guy at best buy and he said that is most likely the "Noise Reduction" option. I bought a movie while I was there and tried different settings but I couldnt get the problem to occur.

TV is an LG (42LH30)

I ran that test and it told me that I would be able to run them. I need to test a few more movies.

I went to the CNet forum and got the recommended tv settings and am going to try that with the movie that I KNOW was having the problem.