For the record, this issue was resolved by removing ASUS AiSuite. AiNap.exe was doing stuff while the system was active.. removing it fixed it.
Hope this helps someone.
All of this is wrong. I get the stuttering with the 1GB 4870 even in a res like 640x480. It's nothing to do with vram.
Strangely I only get the bug in older games like most wanted and warcraft - crysis, warhead and race driver grid all run perfectly.. so, baffled. I am thinking perhaps those...
I am having the same weird 'stuttering' problem: http://forums.overclockers.com.au/showthread.php?t=725200
Even in old simple games with res/details turned down. Haven't found anything useful so far.. :(