XWA - video problems?
It is hard to help without sitting in front of that computer...
But I read somewhere to set the games options right to the hardwares possibilities - and compatible mode does cut down some of the hardwares goodies, isn't it?
You certainly have checked your XWA text files? Garbled text should be a problem concerning the videocard and drivers, but also of some utillities running in the background. Is your task bar full of icons...? All needed?
Maybe you save your pilots (custom missions, altered .lis .txt files, addings...) and take a look at the video setup screen inside the game - then reinstalling. You can even rename your XWA-Folder and let it untouched, installing a "brand new XWA" (beginning from scratch), as people have done for playing other custom made campaigns (with patched XWA.EXE and several changed files).
And I remember once having severe problems with screen-savers or power-save-modes, where after "waking up" the text was like "klingon script", very strange! (I played that day until the end, because the mission was running for hours, playing hard until "last tie falling", so had to guess what sign was which number; ok, red laser-fire helped me to check the distance...).
Or you change systematically the video parameters: all off, lowest, minimum, turning on one at a time.
Some other ideas: old games sometimes don't like newer versions of direktX (but XWA runs on my very old PII-330 with 4MB grafic(!) under Windows 98 as well as under XP on an AMD 1,4 GH with NVIDIA GForce 2 DDR, up to DX9b.
Disclaimer: All I said was just to give you some ideas. Take advice from where you can get it, more than one - but you must decide and you must live with.
Hope you can fix all problems some day, playing all SW-games as you like, and believe me: I know of the frustration of fixing problems instead of playing games (think of it as a game).
Bhakar (alias A.F.)