I'm using an ATI Mobility Radeon X1600 (256MB) and this fixed it for me:

Open a terminal:
$ gstreamer-properties

Select the Video tab and choose 'X Window System (No Xv)' for the
Default Output Plugin, click Test and all should be well.

-- 
Totems ply screen flickers while playing a video or music
https://bugs.launchpad.net/bugs/312337
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