Go to the ATI CC panel. There is an area to tweek the settings for Video playback. These don’t effect the desktop settings at all they are strictly for video playback (ie WMP). I would always use a DVD of The Incredibles because it has a basic THX optimizer in the bonus section, ran WMC7 in windowed mode so I could see the video and tweek the settings. There is a Gamma setting that might be causing your video to be washed out, I’d check that. But the video settings in ATI CC is what you want to be looking at.
