Sony Vegas 12: Flickering and artifacts

bugmenotplz

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I'm having an issue in Sony Vegas where the video flickers, has artifacts and objects kind of 'drag out' (Like, comparable to the trail when you drag a window on an old computer that's freezing). This happened in the preview but i figured there won't be a problem after rendering but after rendering I still had the problem so that turns a nuisance into an issue.

Source video is in 1080i and in .avi. Might be worth mentioning that when imported it into Sony Vegas it didn't bring the sound with it either. (Which I added seperately after it) so I figure it might have something to do with the file extension but I don't want to run it through a converter and risk losing quality while simultaneously doubling it in size, which often happens when I try to convert it into a proper format.
Also,
Using Windows 7 64-bit in case that's relevant.
 

bugmenotplz

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Operating System: Windows 7 Professional 64-bit (6.1, Build 7601) Service Pack 1 (7601.win7sp1_gdr.150316-1654)
Processor: Intel(R) Core(TM) i5-3570K CPU @ 3.40GHz (4 CPUs), ~3.4GHz
Memory: 8192MB RAM
Available OS Memory: 8086MB RAM
Graphic Card: Asus 660GTX 2GB
 

bugmenotplz

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I think I said so already, but the problem persists even after rendering it and running it in a media player. In fact, after rendering it's burned entirely into the video itself considering you can even see it in the thumbnail