I've been having this same issue with my 150+ clients on my network. Worked fine until 3.7., now flickering and completely unreliable. Exactly what you all have been seeing.
I have actually been back and forth with Apple Senior Support about this for weeks now, providing them with a full system scan, ARD logs, and testing different DNS servers. They said this issue is known, has high visibility, and is being addressed by Engineering. I can only assume we'll see an ARD update in the (near?) future with a fix, or perhaps it's an OS-level update and that's what's holding the whole thing up. I sent them an email this AM expressing my disappointment with the slowness of this fix - next stop might be trying to go up the management chain...
In any event, they are aware and have data. In the meantime, I may get desperate enough to try Bryan's script, which sounds effective (thanks Bryan). Not having ARD for my daily management has meant that my clients are degrading daily as their software ages and I can't remotely control them or issue commands reliably. Major ARD fail.