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If I remember correctly, you were given two different videos that were displayed side by side and were given the option to pick the better of the two pairs of video. The result of the two tests provided was to use either an Overlay Mixer or to use Video Mixing Render.
This option is still available in Slingplayer 2.0 in Settings | Sling Player Options | Video | Optimization. The fancy wizard is gone, but if you want to use VMR7 you can check "When available use Video Mixing Renderer (VMR) technology" which is facy words for Direct Draw, you can also check the box below "Use VMR9 if supported on the current monitor" which is also fancy words for Direct3D, not checking either box will use the Overlay Mixer, and if you have Vista then both options are greyed out because it uses Vista's Enchanced Video Renderer (EVR).
Incidently, I still sort of have the issue that you mentioned on one of my older laptops. I had to toggle those settings as well as manually tweak and reduce the resolution and frame rate within the encoding tab in order to get a decent picture. However, on my newer computers its a non-issue.