It affects everything except for the "main HUD" (Reffered to from now on as the "SuperHUD") and my view of actual ships/rocks/stations/gate/etc. My "SuperHUD" includes the left hand sidebar, my target camera screens in the Top Left and Top Right corners, the weapons displays, the personal and target status meters (shields/hull/serial number/speed/distance near bottom of screen), DRADIS Display (3d minimap in bottom right corner), Sector/Universe Maps, and a few other things.
That said, it most assuredly messes up the "lesser HUD" ("SubHUD") such as targeting brackets, Off-Screen object markers (the icons around the outer edges that show the direction of ships/stations that one can not directly see), and Combat aim markers. It also projects 1000's of "artifacts" in aligning random directions from every speck of space dust, weapons shot, missile, and SubHUD bit.
Only one of my 3 attempted screen shots of the problem actually got saved to my HDD

DXDIAG is HERE
I shall attempt to acquire more SSs of this problem and specifically during combat.
Thanks in advance!
:EDIT: Oh yeah, Unmodded, STEAM Version, 1.2.1 and previous STEAM versions equally affected. Terran Game Start. All games started since install are affected. Heavily populated systems seem to cause it more often then barren Unknown Sectors.