Sarael's fix was a great start for me. Explorer was definitely the problem, but the bat file example would 1st kill explorer, 2nd start fallout, 3rd start explorer and go back to my desktop. From there I would see the fallout program was running in the task bar, but explorer re-started already so there was the psychedelic crap again. I did one fix for it to work correctly and a second fix for aesthetic reasons. I'll discuss this in a way that anybody can handle it.
First, open notepad and copy and paste this text:
taskkill /f /im explorer.exe
Save it as fallout2.bat and make sure under the "save as type" selection to pick "all files" and not text. Save it in the same folder where fallout2.exe is located. Set a shortcut on the desktop or wherever to this file. That way you can change the icon and avoid having to look at ugly.
taskkill - kill task, kind of obvious
/f forces the program to quite because explorer.exe is a persistent *******.
/im specifies what image name you are trying to kill (in this case explorer.exe)
fallout2.exe - run what ever execs you want.
The pause requires that you press any key before executing the next command. Thus, no restarting of explorer until you have ended your fallout session.
You don't need "start" in from of executables to run them, but if you want the command window to auto close after running it, you'll need to put "start" in front of any programs that will remain open after the batch file is finished.
There are other reasons why you need to save it in the same folder than just shortcut beautification. When I used the correct file path and tried to execute the bat file from the desktop I got an error stating that the fonts wouldn't load. There is a workaround for this easily available on the web, but who cares, my way is cleaner and faster.
This method will work for any old games that are having similar issues. Sarael mentioned Starcraft for example. A lot of hardcore gamers also shut explorer down along with any other unnecessary tasks before graphics intensive games.