Windows 7?

[Imp]

Same resolution (1680x1050)both modes.

No your not AFAIK Camo games do not support that resolution so the monitor has to reset to the diffrent resolution. If you ALT TAB out of the game back to desktop screen probably goes very briefly black as changes resolution. If you now go back to the game the same happens but in your case graphics are probably corrupted as going to desktop reset to 59Hz.

The important point here I think is what is causing the refresh change hence why I asked what your desktop is refreshing at. Something is causing the discrepancy & as I assume you are checking changing the refresh rate while in your desktop I would say the error lies with windows unless everybody with problems are nvidia users in which case its there fault. Its fair to assume it is not the games fault as if you set to 60 before switch to it the game does not corrupt the setting & runs fine so you may have solved a mystery

As a thought for team nvidia or microsoft might be cheating as thats a diffrent ratio most were based on 640x480 ratio of 1.33 or close but thats 1.6 or maybe switching between to greatly varying ratios is causing the refresh error somehow out of my depth