I'm thinking it may be the player too. I remember when I used cyberlink power dvd 7 I had the same issue with 2 dfferent video cards. It would only do it ocassionally about 2/3 of the way toward the bottom of the screen horizontally. My setup at that time was windows xp and power dvd 7. I recently changed to win 7 and power dvd 9 and I haven't noticed it since.
For me, its hard to say if its a win xp thing or the player since I changed both at the same time. If you are going to upgrade your player, go for cyberlink power dvd 10. It supports 3d and plays extremely well based on my buddys feedback.