Yeah, that looks more like a mod conflict or game bug than a video card problem.
Does it happen in other titles?
Try
downloading 3dMark03 and run through the test on that - see if there are any artifact, and what score it gives you.
Not saying a new card isn't NICE...I mean, SH4 with most the popular mods brings my X1950Pro to its
knees...but...if you don't HAVE to yet, it's probably a better idea to hold off for a whole system upgrade. Current and new games are starting to really like quad core CPUs and 2-4gb of ram, so...