ever played a game at 12 fps!? pretty much unplayable
i think the human eye still interprets 12 fps as 12 separate images as apposed to motion.
the faster the fps the more smooth the image is. personally i can tell if the fps is less than 60-70 fps. if my fps is less than 40-50 then i'll turn it off as its too annoying.
the only thing i can think of right now is the video driver, i cant check right now because i cannot get onto any nvidea website :/ (and i use ATI).
i would be tempted to do some benchmarks like '3dmark' so u can compare your system to others.
also check agp x8 is enabled. sometimes people miss this.