Happened to me as well, I although I also installed the hi-res pack shortly after installing the latest patch without loading up the game between.
Before patch 3 I wasn't experiencing any issues. Running WinXP pro (service pack 2 I believe). I'm never sure how much/what of the dxdiag that you guys need to help solve the issue so I just copied the system info and display info. I'm running the latest Nvidia driver 190.38 and all the setting in the control panel are set to "application setting".
========================================
------------------
System Information
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Time of this report: 8/1/2009, 10:46:30
Machine name: FLIMFLAMERY
Operating System: Windows XP Professional (5.1, Build 2600) Service Pack 2 (2600.xpsp_sp2_gdr.070227-2254)
Language: English (Regional Setting: English)
System Manufacturer: System manufacturer
System Model: System Product Name
BIOS: BIOS Date: 01/30/07 15:09:48 Ver: 08.00.12
Processor: Intel(R) Core(TM)2 CPU 6400 @ 2.13GHz (2 CPUs)
Memory: 2048MB RAM
Page File: 684MB used, 3255MB available
Windows Dir: C:\WINDOWS
DirectX Version: DirectX 9.0c (4.09.0000.0904)
DX Setup Parameters: Not found
DxDiag Version: 5.03.2600.2180 32bit Unicode
------------
DxDiag Notes
------------
DirectX Files Tab: No problems found.
Display Tab 1: No problems found.
Sound Tab 1: No problems found.
Music Tab: No problems found.
Input Tab: No problems found.
Network Tab: No problems found.
--------------------
DirectX Debug Levels
--------------------
Direct3D: 0/4 (n/a)
DirectDraw: 0/4 (retail)
DirectInput: 0/5 (n/a)
DirectMusic: 0/5 (n/a)
DirectPlay: 0/9 (retail)
DirectSound: 0/5 (retail)
DirectShow: 0/6 (retail)
---------------
Display Devices
---------------
Card name: NVIDIA GeForce 9800 GTX/9800 GTX+
Manufacturer: NVIDIA
Chip type: GeForce 9800 GTX/9800 GTX+
DAC type: Integrated RAMDAC
Device Key: Enum\PCI\VEN_10DE&DEV_0612&SUBSYS_0A7619F1&REV_A2
Display Memory: 512.0 MB
Current Mode: 1280 x 1024 (32 bit) (60Hz)
Monitor: LG L1960TR(Digital)
Monitor Max Res: 1280,1024
Driver Name: nv4_disp.dll
Driver Version: 6.14.0011.9038 (English)
DDI Version: 9 (or higher)
Driver Attributes: Final Retail
Driver Date/Size: 7/14/2009 11:54:00, 5842816 bytes
WHQL Logo'd: n/a
WHQL Date Stamp: n/a
VDD: n/a
Mini VDD: nv4_mini.sys
Mini VDD Date: 7/14/2009 11:54:00, 7741664 bytes
Device Identifier: {D7B71E3E-4552-11CF-0F59-7D2A03C2CB35}
Vendor ID: 0x10DE
Device ID: 0x0612
SubSys ID: 0x0A7619F1
Revision ID: 0x00A2
Revision ID: 0x00A2
Video Accel:
Deinterlace Caps: n/a
Registry: OK
DDraw Status: Enabled
D3D Status: Enabled
AGP Status: Disabled
DDraw Test Result: Not run
D3D7 Test Result: Not run
D3D8 Test Result: Not run
D3D9 Test Result: Not run
===================================
I'm also seeing a strange graphical error on the water, it's tough to explain and I'm having trouble reproducing it, it seems to happen off and on when I enter an arena at random. When I first saw it I thought I had dust or smudge on the monitor when I was looking at the water, the only other way I can think of describing it is that the detailed drawing of the water at closer ranges has a rash. I tried filming but it doesn't re-appear when I view the film. Next time I see it I'll get a screen shot.