Something is wrong here

[jackslammer]

This is almost always a driver problem, and you said that you've attempted to re-install drivers and the installation fails, so it definitely sound like a driver issue. First thing I'd try is removing any AMD video drivers and installing the latest drivers with default settings.

Guide to uninstall Catalyst drivers on an Intel system: http://www.overclock.net/t/988215/how-to...hics-cards

Hotfixed latest Catalyst drivers (12.4a): http://www2.ati.com/DriverS/hotfix/catal...x_win7.exe

Issue Description:
We’ve recently identified an issue where some of our legacy graphics products are producing certain artifacts in Diablo III with our latest release of Catalyst™ 12.4. This issue only affects users of ATI Radeon™ HD 2400, 2600, 2900, 3400, 3600 and 4500 graphics cards under Windows® Vista® and Windows 7.
Note: Users of these products under Windows XP are unaffected.

Resolution:
This issue has now been resolved in the AMD Catalyst 12.4a hotfix driver. Users of the ATI Radeon HD 2400, 2600, 2900, 3400, 3600 and 4500 graphics cards are the only AMD customers who need to download this hotfix driver.

Try those things and report back along with any details about installation errors, also system specifics would be helpful.