HL2 Episode One gfx stuttering issues- any solutions?

Hi all

HL2 runs like a dream on my system; HL2:episode one on the other hand, not so much. Monsters and people all stutter badly, but panning the camera around seems smooth. What gives? If I turn everything down to 640x480 and the lowest settings possible, the models all still stutter as they do at 1024X768 with everything turned up. This makes me think its a software problem, not my rig. HL2 Lost coast also runs very well, without these stuttering issues. Anyone else run into a similar problem? How could there be that much of a difference between two extremely similar games? (The only difference is HDR, pretty much.)

Setup:
C2D 6400
BFG 7600GT
Asus p5B-E mobo
2 GB G-Skill RAM

I'd think the above would be more than capable of at least handling the game at medium settings without any stuttering. Very disappointed.

If anyone knows anything it'd be much appreciated. Thanks!