Originally Posted by AaronP
The nv driver doesn't support Xv on GeForce 8 and up, so your video player is probably falling back to an X11 output plugin, with software scaling.
Why doesn't nv support it on those cards? The card obviously has the hardware features to do it and it won't be cutting into the nvidia driver 3d features so no proprietary hardware specs would be divulged if that's the reason.
besides that, I don't think I was using Xv when I used to use the nvidia drivers and the video didn't look blocky. Sometimes even when using nvidia drivers in Linux or in Windows, the video looked blocky and a reboot fixed it (haven't rebooted yet as I'm working ).