Images get messed up with multiple frames on _root level

If I add more than 1 frame to the _root level than the images in my main mov start to look “wavey” and distorted, esp when they are moving. But if I keep only 1 frame in the _root level than they look great.

I need to add a preloader so I need a minimum of 3 frames in the _root level.

here is the one that has multiple frames on the _root
http://www.proximitydesign.com/test/test.html

here is the one without multiple frames
http://www.proximitydesign.com/test/test2.html

Any ideas why this is happening?