It turns out it was an uninitialized variable in code that was never used until NV changed their drivers. As far as I can tell, NV dropped support for FSAA in 16-bit mode a few months ago, at least on some of their newer GPUs. (It is also possible that the incantation necessary to get FSAA has changed a lot and I simply don't know what it is.)
So the dialog between X-Plane and the video card ran something like the Monty Python cheese shop sketch:
X-Plane: So ... can you do full screen anti-aliasing?At this point in the dialog X-Plane would promptly lose track of what it had been doing in the setup process, throw out its notes on the GPU setup, and then freakout a bit later when it realized its note taking left something to be desired.
GeForce 8: Oh yes, of course! (Please, I'm a GeForce 8 card.)
X-Plane: Splendid! So...how about 16x FSAA?
GeForce 8: Sorry, can't I can't do that.
X-Plane: Ah. How about 8x FSAA?
GeForce 8: Sorry, can't do that either.
X-Plane: I see. Well then, how about 4x FSAA?
GeForce 8: Nope.
X-Plane: 2x FSAA?
GeForce 8: No way.
X-Plane: Ah. I see.
This is the first case I've hit where a video card advertises FSAA and can't actually do it.
Anyway, if you have hit this bug:
Update to 941 final - it should fix it.
Stop trying to run with FSAA and 16-bit color. This is a somewhat crazy combination. FSAA attempts to clean up rendering artifacts at the cost of fill rate. 16-bit color creates artifacts to save fill rate. If your GPU needs 16-bit color to run at high framerate, it's time to turn FSAA off.
*This assumes 5551, or 565 pixels. There is a 4-bit alpha 16-bit color format, cleverly called 4444, but if you thought 16-bit looks bad...