Windows – NVIDIA secondary display problem on Windows 7 Professional 64-bit

All of this was working fine on Windows XP Professional SP3. I just installed Windows 7 Professional 64-bit and it doesn't work anymore.

My video card is an NVIDIA GeForce 8500 GT. I have a plain old VGA cable running to my primary display (19" LCD monitor). I have an S-video cable running to a Philips RF Modulator (model ph61159) pictured here:

From the "TO TV" coax jack on the back of the RF modulator, I have a coax cable running to a splitter that sends the signal to all of the TV's in my house. So when I wanted to watch a computer video on one of my TV's, my process was:

1. Enable the secondary display.
2. Drag the video to the secondary display.
3. Turn one or more of my TV's to channel 3 or 4 (depending on the RF modulator's front switch)
4. Enjoy.

See the little red LED on the front of the RF modulator? It's supposed to turn solid when I have the secondary display enabled. It's off otherwise.

Before installing Windows 7, the light would turn on as soon as I switched on the secondary display in either Windows Display settings or using the nVidia control panel (either way worked).

After installing Windows 7, the light will blink a little bit when I switch on the secondary display in either Windows Display settings or using the nVidia control panel, but goes off and ultimately I have nothing sent to my TV's.

Here is a video of what is happening.

This is a show stopper for me. I will reinstall Windows XP if I can't get this fixed. Is there anything I can do?

EDIT

I had my wife watch the tv while I turned on the secondary display and she saw windows on the tv for a moment, but then it disappeared.

EDIT 2

I changed the refresh rate for the TV from 29hz to 30hz and that gives me a solid red LED on my RF modulator, but the TV has a black & white picture that isn't still (moving from top to bottom very quickly.) I haven't found any more advanced settings yet. Any ideas?

EDIT 3

I noticed that when you change the tv's refresh rate to 30hz and press apply, the refresh rate changes to 25hz, which wasn't in the list of options before.

EDIT 4

At some point I had a still black & white picture on the TV, but I have no idea which combinations of nvidia control panel settings and windows display settings got me there.