It looks like when NPCs are blocked from the PC's vision, the camera above the PCs corner causes the NPCs to flicker. It isn't something distance related; I noticed it when I went behind a pillar and took a short video example.
NPC flickering behind pillar
It didn't seem to happen with all pillars, but this one was easy to see.
My video settings are set to max, and I believe this was DX9. Could the HUD be modified so it is a little clearer which option is chosen for the video? I think right-justifying it instead of left-justifying it would be clearer.
Sorry, this is for Tribble (duh).