Thanks CrLf, that did the trick. I did read ALL the related forum posts first. The only mention of this setting in the forums, is in these threads:
How to disable vsync (problems with the 5200 card, not TNT2):
Turning OFF vsync (Quake 3 problem resolution):
It's unlikely that anyone searching for problems with the TNT2 and 5336 release will be able to find this solution, except in this thread. It would have been nice if NVIDIA had included mention of the change in the release notes. Instead, the release notes specifically indicate that the setting DOESN"T APPLY to the TNT2:
"Setting the environment variable __GL_SYNC_TO_VBLANK to a non-zero value
will force glXSwapBuffers to sync to your monitor's vertical refresh rate
(perform a swap only during the vertical blanking period) on GeForce or
newer hardware (ie: everything but TNT/TNT2 products)."
The release notes need a BOLD statement AT THE TOP, whenever a change like this is made, so that people at least have a chance to find it.