I've had this exact problem for a long long long time
I use a 5850 ATI card, and I get choppy gameplay too. The best way to describe it is, every 1.5 seconds the game drops a frame then jumps 2 frames (instantly) catching up. You'll never lag or fall behind or slowed down by any means, but it's just annoying. No driver updates or settings seem to fix the issue, and it's exclusive to FFXI, no other games I have experience this issue.