Doug wrote:
I never used the webcam on the laptop back when it was SP2, so I wouldn't
uninstall a whole service pack when it wasn't guaranteed that it would work.
I also wouldn't give up the security benefits of SP3 just to get a webcam
functioning properly. I am pretty sure that the problem lies with the old ATI
video driver or the Microsoft Lifecam driver for the camera itself. I use the
camera on my new PC without a problem, so I know that it is fully functional.

Having the exact same problem with a Microsoft NX3000 webcam my daughter
got for Christmas which refuses to work properly with her Dell Vostro
1000 laptop with a Sempron 3800, 1 GB of RAM and Windows XP.

The Vostro also has an ATI video chip.

It functions correctly at the lowest resolution, but the video breaks up
at 640x480 and 320x240.

It works correctly when plugged into our aging desktops, with half the
RAM and smaller processors than the Dell.

Please share if you find a solution outside the group. We will, as well.
I have another brand of webcam coming which advertises no need for extra
drivers. Will post if it works.