Yeah, I've had the same problem and have yet to fix it. Interestingly, (at least in my case) after I enter a new area this stuttering/looping happens, with the sound snagging up about every couple seconds. While fooling around with it though, I noticed through out the entire period my HDD LED blinks once every second. Now, the really weird thing is that 10 minutes (maybe longer) after I enter a new area the HDD LED stops blinking and the stuttering is completely gone. I don't necessarily even have to play during this time, I just have to enter the area, press ESC and go to the menu, then go watch some TV for a bit. I come back, resume my game, and it runs fine.
Needless to say, it kinda ruins the atmosphere, so I'd of course still like to fix it, so I'll contribute what I have to help figure this out:
ASUS k8v SE Deluxe MBoard
Athlon 64 3200+
1 GB of PC2700 RAM
Radeon 9800 Pro 128MB (Currently using Catalysts 4.7)
Soundblaster Audigy Gamer
Windows XP
Direct X 9.0b
So here's what I've tried myself:
Switching Radeon Drivers - tried 4.7, the leaked 4.8, the 4.9 Hotfix (Done with Driver Cleaner just to make sure)
Clean Installation of newest Audigy drivers
kX Project Drivers
Increased AGP Aperture Size from 64 to 128
Turned off Fastwrite
That seta image_useCache, CacheMegs and CacheMink Tweak
Turned down Audio Acceleration to Basic
Switched from Quadrophic Speaker setup to 3 speaker Stereo setup
Performance Mode for the Open GL Settings
Turned on Triple Buffering
Lots of fiddling with in game settings
And yes, my Hard Disk is Defragged
That is, I believe, everything I have tried. I've yet to try the pak decompression thing just because it doesn't sound like it actually does anythings besides make it harder to load up the game. If I stumble across any miracle cure I will let you know.