Yes, certainly weird when it was previously fine.

EDIT: Whilst I remembered this could have something to do with the icons being 16bit (low resolution), but some more googling on XP tray icons poor quality 16bit. That brought up an unexpected hit which also mentioned one of the windows font sizes can have an adverse effect on the tray icons, http://www.infopackets.com/news/software/windows_tips/2003/20030903_windows_taskbar_icons_are_distorted.htm.