Most people like myself just live with the distortion. I have not tried the fix mentioned above bye BIGSKY. However for the 2D popups causing the flickering mouse, single digit frame rates and sim crashes can be fixed. Navigate to your SimObjects>Airplanes folder and in each aircraft folder find the panel folder and open up the panel.cfg. You'll find a list of all the windows for that aircraft listed as [Window00] and [Window01] and so on. In each window look for where it says size_mm=1280,960 for example. Under that line you need to add pixel_size=1280,960. So what ever numbers it has listed under size_mm=, use those same numbers in an added line under pixel_size=
Here are two example windows taken from my Coolsky DC-9 panel.cfg and the added changes are in bold.
[Window01]
file=CSDC9 - Overhead Lower.bmp
size_mm=1280,960
pixel_size=1280,960
window_size_ratio=1.000
position=0
visible=0
ident=10090
zorder=29
[Window02]
file=CSDC9 - Overhead Upper.bmp
size_mm=1280,731
pixel_size=1280,731
window_size_ratio=1.000
position=0
visible=0
ident=10100
zorder=30