Ok, let me update you on my progress, which might help narrow things down. Since my initial problems back in October, I've now upgraded to a new PC with Windows 7 x64, and a rather gorgeous Radeon 5850, which is all rather groovy, even if the system did cost me £900!

More importantly, the graphical glitches in Aquaria have gone. Whilst I could give W7 credit, my money is far more on the change of both graphics card and the Drivers / Catalyst that go with it.
My Radeon X1950 was a great card, good value for money and lasted me a long time, but I did have issues on certain games. Odd graphical glitches, artifacts that would appear the longer I played, and even some fairly dramatic video corruption. My X1950 AGP was fairly prone, the PCI-E version I replaced it with early 2009 wasn't nearly so bad, but both still had issues, and weren't improving with time, either.
I've had ATI cards since day one, but they've always been a bit temperamental, especially as the cards age. I think ATI are pretty heavy on pushing forward, which is why they slap the label "legacy" on drivers for anything over a generation old.
So here's the short answer. I suspect it's a problem either with that generation of card, or with the generation of drivers for it.
I doubt ATI have actually updated the driver for the old cards in quite some time, new versions of the Catalyst may come out but in effect anything Radeon 2XXX or below is going to be using older drivers, and ATI aren't going to waste any time keeping them up to date.
Best and easiest solution, to be honest, is to upgrade your card if you can. If you're running Vista 64 and into gaming, it's really the only way. A 3XXX series, something like the 3850, you can get for around £50-£70. It's that or, unfortunately, live with the fact that the X1950, while once a great card, was released in 2005-2006, so it's getting on for five years old. In gaming terms, that's a lifetime.

Hope this is of use, glad to know it wasn't just me having problems, but as the only two people reporting it and we both (at the time of the problem) were using X1950s, I think it's pretty clear where the trouble lies.
Good luck!
D
