The two screenshots are with AA enabled.
This is zoomed in to the 3d map.
This is zoomed out to the cloth map.
Apparently something was screwed up. A reboot fixed this last problem.
This third screenshot is with AA disabled.
Here is the link to the debug.err
For what its worth, my old 4870x2 ran everything fine. I put in a new 7970 last night and now I have the above glitches. If you need any more info let me know.