Game only lags fullscreen

This one has me stumped, curious to see if anyone has encountered it before.

Recently (I can't say for sure when, but probably in the past month) I have been having lag issues with the game. Until today I had not realized that my problems only occur when I am playing fullscreen. This is weird because when I play "windowed" I still have the game stretched to cover the entire screen sans taskbar, so basically 90% or more of the fullscreen resolution. But it does not lag windowed. This is what I have tried so far today:

Reverting to an older video card driver (175.xx WHQL)
Reducing all in-game graphics settings to minimum (god, that's ugly)
playing with and without v-sync (via F11)
disabling AV while playing
deleting KSMod files
uninstalling Riva-Tuner (only had it controlling fan speed)
Forcing v-sync on/off in driver control panel

None of the above helped. Still runs fine windowed, lags full-screen. The lag is weird, too. Every 3 to 5 seconds it just pauses, as if the network connection was dropped. Then it will play normally for a few seconds, then do the same again. The rubberbanding effect is painfully unbearable. This happens in towns, instances (even solo), observer mode, everything. It just seemed to happen for no reason, so I can't pinpoint anything that might have changed on the computer. I have played Bioshock fullscreen as recently as yesterday and it had no video-related problems (Bioshock has its own set of problems, but I digress).

Obligatory specs:
XP SP2
2GB RAM
Athlon 64 2.4 GHz, single core
8800GT 512MB
Nothing overclocked

I'm almost at my wits end on this one. Right now I'm downloading gw.dat over. If that doesn't solve it when it gets done, I'll run memtest overnight. Any other suggestions are welcome.

Upgrade to SP3, might not fix anything, but there's no reason not too.

Apparently my firewall program had gotten screwed up. Took a while to narrow it down. I uninstalled it and got a new one, and all is well. Please lock / delete.