Yours is / was doing the exact same thing that I just corrected today. I know you asked this a while ago, but if you didn't get it fixed, or if there's someone else that's still having the problem. I'm going to guess that your FMVs that occur with the "low-res" characters in the foreground clip, like the scene moves and the people don't. All that would happen in the game with me, was the music freezing and a left eye blinking, mine was Aeris where yours is Tifa. Anywho, I followed someone else's advice about codecs, and found that the K-Lite Codec Pack 2.72 (full) DOES indeed fix the problem for me. My videos don't clip, my videos run smoothly again, and I was able to shoot past the Bugenhagen scene. I downloaded it here >>>
http://filehippo.com/download_klite_codec_pack/?988The scene then runs further, Bugenhagen actually moving like he's supposed to, the video finishes playing, and everything goes off without a hitch.
I didn't use Gypt, or any crazy patches. 1.2, with the choco race patch added. And now the new codec pack, working beautifully.
Athlon 64 3800+
2GB DDR800 Corsair Memory
Nvidia GeForce 6800 Pro (Also tested with a Radeon 9800 Pro)
XP Pro SP2
****EDIT**** It also fixed the fact that I would sometimes lose sound in some FMVs as well.