Yah, I'm not too pleased with Nvidia at the moment either. I bought a 260 GTX to work on a CUDA project, giving my old ATI 3870s to a friend, and the new card does GPU recovers all the time when I'm watching videos. Never had any issues with the 3870s. So, I need to turn off Hardware Acceleration in Flash to be able to browse the web without the error popping up and turn off all "PureVideo" settings in the Nvidia control panel to stop Netflix videos from causing worse problems (black speckles across the screen). After doing this, it still has problems on occasion.

If you're sure it's the drivers, the Nvidia control panel lets you change settings on a per application basis. Hop in there, find the game in question and turn complicated things off. "Conformant texture clamp" and "Threaded optimization" seem to do the most help turned off on older games.