Do you have any kind of antialiasing or anisotropic filtering on? It kinda looks like you do, but I guess it could just be compression on the image.
Anyway, can you give us some info about your system? (Video card, OS, etc)
[Edit] Someday, I'll learn how to spell "anisotropic" without having to go look it up in the control panel.
[Edit 2] Have you tried using software rendering? If it works in software rendering, it is probably a problem with your graphics driver configuration.