Hey everyone! First of all thanks for the extremely useful hints and tips in this thread!
Yesterday I finally managed to get the wounded shader working with the 196.2 Nvidia driver.
These are the steps:
1) Installed Nhancer 2.5.3
2) After installing I set the Bf2 profile as instructed on the first page of the thread.
3) Do not close Nhancer yet....Click on Tools > Activate profiles
4) close enhancer
5) delete the cache (my documents/Battlefield2)
6) Disable AA in game
and walaaa! Shader works again.
Also as someone else stated b4 if in nhancer you activate the Antisotropic filtering even at 2x, FH2 graphics are so much better!!!
For your info my system is Amdx2 4200+, WinXp sp3, Nvidia 9600gt, 4GB DDR2 Ram