I just formatted / reinstalled with Win7 [using Nvidia 260 card with the latest driver 196.21]
And set up my PC as i normally do... setup Nvidia control panel as i had previously. With very high quality setting, AA, Antisotropic filtering etc etc all maxed out.
Loaded PR and was met with the following: Glass ground and crappy AA
I reset Nvidia control panel to let BF2 manage all graphic setting and got this: Good AA & no glass ground
I had previously had no issue using the Nvidia control panel to boost my settings.
I hope this helps others.
EDIT: on further testing the cause is ONLY Antisotropic filtering. All other Nvidia control panel 3D setting work fine.