I'd try setting haze back to 1. Take a look at the Shooting Range mission with and without it. Without haze it looks pretty messed up! Use an external view and zoom way out. A lot of the ground seems to get covered in an odd fog without haze on.
Effects 1 looks good enough to me, considering the FPS boost it gives in combat!
And I've been playing with lights = 0 for a while now and haven't noticed any problems. Maybe at night, though, the lack of dynamic lights becomes a problem. Too bad they hurt the framerate so much!
I think I was CPU-limited in XP, but under Vista with the affinity fixed it seems to run as fast as my GPU will let it, so these options tweaks are really helping me have a smooth time :)