My guess is you have V-sync enabled, and your GPU can't keep up with the rendering, so it skips every other frame (or so). What's your video hardware?
This means the display is updated at uneven intervals, creating a jaggedy feel.
Try enabling 'FPS in caption' in app properties, and set the framerate mode to unlimited. If the framerate is still below your monitor refresh rate, the V-sync will make the framerate uneven.
You could also post your .cap file to see if anybody else can find a problem.