Noel, our display code has some convolutions in it that might create video problems. However, given the few that are experiencing what you are (Paul found his problem was with his Compact computer and the video card he had), it is most likely your computer is the culprit. We will be totally rewriting the video code in an upcoming version upgrade. It will display the video full screen while playing, appearing just like a Karaoke Player machine and a monitor. When we rewrite it, your problem may go away.
Please run the dxdiag.exe program on your computer and email support@mtu.com the resulting file. The post at:
http://mtu.com/vbulletin/showthread.php?threadid=14 gives details on what to do. The data this will give us on your computer may give us an absolute direction for you.