Hi Gregl
This type of problem in my experience is caused by the graphics card, or your RAM.
If it was your RAM however, i would expect your machine to crash completely on the event of an error.
So I am inclined to lean toward your graphics card's RAM. As it gets full during use, it is getting to a bad chip, and the graphics it is storing gets corrupted and output like that.
The only thing you can do for it is to replace the graphics card, unless it is still under warranty, send it back for replacement.
Lucky for you a 8500gt replacement card is only $39.99 US for a new card with free shipping.
http://www.newegg.com/Product/Product.aspx?Item=N82E16814141066&Tpk=8500gtI am assuming your board takes PCI-e because of the other specs and I am fairly certain that nVidia stopped producing AGP cards after the 7 series.