Is it possible that you also have an integrated intel graphics chip in the computer? Maybe Penumbra is not using the NVIDIA graphics, rather it is running on the integrated chip instead. If you have two graphics cards, it should be possible to specify which card to use by using the nvidia control panel.
Beautiful! That was the problem exactly! It had been running it under integrated all this time. Everything looks great now. Thank you both so much for all your help! Greatly appreciated!
Then you don't have an nvidia graphics card rather an Intel graphics card. Try to update the drivers for the intel graphics card, follow this guide http://www.frictionalgames.com/forum/thr...l#pid89162. If that does not help then it is likely the game won't work as the card is not officially supported.
I've already followed all the instructions on that page, and it still has that same problem. There was that one solution that gets rid of the white screen but makes the graphics all terrible, but I guess I can manage with that if nothing else.