Microsoft have confirmed there is a corruption issue affecting Windows 7 users with ATI hardware:
On Windows Media Center, when switching channels on broadcast television, or loading certain broadcast recordings, video output will become corrupted. This corruption may last from a few seconds and automatically correct; or may persist until the channel is changed or an alternate recorded file is played.
Microsoft currently has an issue which is resulting in a valid picture frame at the entry point into the stream to be dropped and replaced with an ‘empty’ padding frame. The loss of this frame causes corruption of video in all hardware and software decoding of the stream. The specific sequence of events triggers a prolonged error recovery sequence on ATI hardware. Microsoft and ATI are working together to address this issue.
At the moment there are no workarounds or fixes so if you have the problem you will just have to put up with it for now
Welcome to show number 356, this week Andrew joins me ... 
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Back in the UK for this weeks show. Andrew was away ... 
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Curious. I’m glad to see this come to light. I had similar issues and had to dump my ATI card for an Nvidia. I’d like to bring my ATI card back to use. Love the built in HDMI audio.