blasto ... same happned with my system even after having core2duo and 4gb ram with 7850gx2 card.. however it was issue with vlc as it is not good handling that kind of resolution files and becomes jittery...
+1 for media player classic with k-lite kodec pack...
everything work fine now
Wow.. I almost forgot this thread now.
Getting the WD TV is the death blow to my search for players, connecting laptops etc + it gives almost professional upscaling out of the box with out having to haggle around with settings.
No more software media players for me.