Well I think I have found out the problem, and i believe it is my AGP port. I put my friends geforce 6200 in like you said Xaxly, and I ended up with the same results which had even intensified with the 6200 compared to my 6800.
It is weird though because my old geforce 5700 card works fine in my rig, so perhaps it is just the series 6 video cards or perhaps because both the cards use Shader Model 3.0 which is rather intense. As I said earlier, the tearing is usually associated with character shadows or heavily shaded environments like in Fear.
Anyway I thankyou all for your input and help with my problem
Now I guess i'm gonna have to save for a new mobo and cpu, lol the upgrading never ends!