This would indeed indicate a driver bug. But I can't reproduce it here. I tried on several machines, even with GF 5500. Your dXDiag looks normal. Try the following:
- Use a 24 bit texture. 16 bit not only look bad, it's also normally never used, which means the probability of a bug is higher.
- Use the latest version, 7.80.
- Update your video driver.
If all 3 methods don't help, please post again.
I think the mystery with the bone is solved: Your code is not printing the bone parent name, but the bone's grandfather's child name. That's because you were also using ent_boneparent for converting the handle to a name.
This is not your fault because the engine has no command for converting a bone handle to a name. This will be implemented in the next update.