I have heard that this may be caused by Macrovision copy protection, the same thing that will keep you from making a VCR copy of a DVD.... Macrovision will scramble the image, or will not record at all, if you try to record a DVD to tape.
Supposedly, the DVD requests that Macrovision be turned on, and the HARDWARE (i.e. the DVD Player will then modify the signal it send to the viewing device (Monitor, TV, hdtv, etc) so that the signal cannot be recorded.
It may be that the signal from my DVD player has MAcrovision turned ON, and the monitor cannot decode the signal properly... causing the strange behaviour.