Well, if you have the same problem on 3 different vid cards, something else may be setup incorrectly. As to what, I really couldn't say.
If you dig backwards in this forum, or even search it for dds, you might find the solutions there.
Doing the export to tga is a royal pain, and takes a huge amount of disk space and really clutters up the override folder.
One thing you might have success with, is updating XP, when you update, check the optiosn of optional updates, see if there is a different vid driver for your card listed there. Not sure if that will work, but it might work better than what NVidia supplies. To be honest, I can't really remember exactly what fixed mine. I know it had something to do with the driver, and I seem to recall downloading an older driver for my card... You MAY be able to reinstall the original drivers that came with the card itself, if you still have the cd that came with it. Then not update the driver at all. That may work.
NVidia supports the industry standard format for DDS, NWN does not. That standard has improved, but to be honest, not enough to really make much difference in what you see, the issue is that the head data at the top of the dds file is different for the industry standard stuff... NWN was created a LONG time ago by industry standards and written for hardware that is now considered very outdated.
Anyway, good luck with it.