UPDATE

I tested the second unit with several disks and here are my findings

BluRay - picture perfect
Anitmated DVD (Pixar) - perfect
Film based DVD - lines

I used about 8 disks.

I replaced this unit with a LG BD570 and all is fine.

All I can figure is there is some issue between the Fuji and the player with 3:2 pulldown. Who knows.

I brought the other player home and I'll test it here on a few setups. The original was fine on my Samsung 26" tv I use as a computer monitor