I use Indivision Mk2 with CRT VGA monitor, also tested it with LCD VGA one.
The problem is with standard interlaced screenmodes (PAL 640x512, 1280x512). It doesn't flicker when nothing moves on the screen. But any object that moves - mouse pointer, text etc. - looks like it's interlaced.
Does anybody have problem like this? Is there a chance that flashtool will fix it?