Several Rhino users have reported this problem recently and figured it out. The problem turned out to be Adobe Acrobat 9 Pro Extended. Apparently they (Adobe) are doing an OpenGL text grab that is messing up the Rhino display. The work-around was to go into the Acrobat tool and remove Rhino from the list of 3D applications.
Added 8/16/2012 - John Brock