Hi guys... and girls..
Have seen many posts about blocky pixels on movies, suggesting users that have hardware or driver problem... displays, graphic cards etc..
Well the solution that helped me was quite obvious.. try:
Right click on your AMD catalyst to open... there is something like "video settings".
Go to the "quality" and see if your sharpness is above the "0" in any value. Put video sharpness to "0" and restart the player. Pixels of medium/low quality movies should be gone.. This function is great on big screens and full hd movies, but it decreases the quality of small images trying to make them more visible.
Should work on any Radeon HD and catalyst 10 and above.
(Solution tested on ASUS HD6770 DirectCU 1GB with Catalyst ver.12.3/4GB DDRII /QuadCore firstname.lastname@example.org)
(Sorry if some words of above may be hard to find in your drivers options, but I run a polish version of catalyst so some elements might be badly translated