Click on the Windows start button. Next click on run and type in DXDIAG. Once the DXDIAG box pops up please click on the display tab The next step would be to disable, then re-enable all 3 of the DirectX features. After you have re-enabled all three of these features, please run the test again. If the test is successful you may then proceed to play Shrouded Isles to see if the problem at hand is corrected.
You may also want to try setting your monitors refresh rate to 75Hz. You can do this by performing the following:
Right click on the Windows desktop enviornment. Click on properties. Next click on the settings tab. Next click on the Advanced tab. Next click on the Monitor tab. Under this section you will be able to select the 75Hz option if your monitor allows that rate.
(Please note, some older monitors cannot handle above 75Hz and will black out. If this does happen, reboot into safe mode *F8 on bootup* and go back and change your resolution to a known working one.)