OK, when I play GW on one specific Windows user account, my texture quality seems to be all the way down even though I keep the graphics level at the highest it goes. Mind you, it only happens on this one certain user account. On another user account on the same computer, the graphics are fine and are fine on other computers. Picture as example.
I wonder if on that user account your actual graphics card ATI/Nvidia Settings in Windows are set differently. Or maybe a non-admin account limits you, no idea though sorry.
Closest bet would be the graphics card's settings in windows on that particular user account.
EDIT: Did you try to move the bar all the way to the left then back to the right? Could be registry settings for gw on that user account too.