Ok.. I'll take a swing at this one.
I think you need to update your windows media player. It sounds like you have an older codec installed. That psychedelic-blocks-on-a-rampage is a sure sign the installed codec isn't compatible with the compression used on the video.
Fav quote - "Experience is whatcha don't get 'till ya don't need it no more."
System - Athlon 1.4GHz, Win98, Hauppauge PVR250 receiver and compressor.
Software -Magix Movie Edit Pro 10, Nero 6 + NeroVision Express, Moho 4.61, PSP 8.1, Bryce, Quicktime 6.52 pro, Goldwave 5, DVD-Lab.
Cameras - Panasonic GS9, Canon ES8400V, Canon EOS D20 and Canon A70