ATI x1600 Pro Driver Install Problems

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The History: I've tried consulting multiple threads on various forums to address this problem. I've found problems similar to what I'm experiencing, but I have not found any relevant solutions.

The Problem: After I install the device drivers for my ATi x1600 Pro AGP, my computer becomes less responsive, there is noticeable lag time when loading anything (the start menu, my web browser, etc.). I have installed the latest drivers available, as well as the original drivers that came with my GPU. Every process on my machine is laggy, the mouse becomes unresponsive, simple items such as loading a web page take up to 30 seconds to complete. I have reformatted my computer, and I am entirely sure that it is free of any viruses or malware. There is a BSOD that appears infrequently, but no error code is presented, simply that there is a serious problem with my machine, and that it is doing a physical dump of my memory. I am sorry to have so little information on the BSOD, but the problem is related to the drivers for my graphics card, I'm sure.

My Specifications:
Microsoft Windows XP Home Edition, 5.1.2600 Service Pack 3
x86 Family 6 Model 10 Stepping 0 AuthenticAMD ~2200mhz, Athlon AMD 3200+
ECS M848A Motherboard
ATI x1600 Pro with 512mb DDR400mhz AGPx8 on x8 AGP slot
2.0 .net client (required to run catalyst software, but I do not necessarily need the full suite, just the device drivers for full functionality.)
DirectX 9.0c
2gb/2048mb DDR2 400mhz Corsair w/heatsink.


I have used this machine in the past, but as a college student, I primarily used my laptop throughout the semester. In the past, I had simply used my device drivers disc to install the full catalyst suite, and with the same hardware then as I have now, the computer ran optimally, able to run games such as F.E.A.R. on nearly full quality on 800x600, and later games such as C.O.D. 4 on 1280x1024 with low-detail.

Currently, I have completely uninstalled all ATI-related drivers for my GFX card and now my computer runs very quickly with it's only problem being the clipping when scrolling inside of programs (due to the lack of smooth-scrolling/desktop anti-aliasing).

I think what I need is a signed driver for my hardware for windows Xp, however, I have been unable to find any such driver.
 
Revert back to xp sp2 , sp3 is causing the conflict.When it came time to decide to install sp3 or not I reviewed the change logs in sp3 and concluded there were no tangible benefits to functionality and I feel I have avoided a few with that decision.
Reply to my post, if this is not the right fix there are others but do the easiest one first.
 
Thank you for your quick reply!

I can do that. However, I am a member of MSDN, so I simply downloaded the WinXP SP3 full edition, where SP3 was already installed (to prevent security issues when first reformatting).

Is there a way for me to "revert" to SP2 without a full reformat? I suppose my problem is that I cannot exactly "rollback" when my primary installation included SP3.
 
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