Have you noticed that new ATI Radeon 7200 (version 4.13.9009) drivers break w-buffer support ?
Sky and terrain are all brown when w-buffer is on ..
But does this problem reside in Radeon drivers or is w-buffer support in Flashpoint buggy ?
W-buffer is working fine with my geforce 2. ATI is known for "not-so-good" drivers. All you can do is reinstall your previous drivers or turn off w-buffer. Since W-buffer is superior to Z-buffer (visually), I wouldn't use the new drivers unless they improve something alot when compared to the previous drivers.
I had the same problem after updating to the 9009 driver.
W-buffer support was broken and I had some more graphic errors (for example about half a second of flashing wheels of the broken truck in the background of the OFP menu shortly after starting).
After moving back to the 7189 driver from my Radeon 7500 CD (you can download it at support.ati.com) everything was fine again.
I'm using OFP version 1.42 and Win98SE.