Have you tried playing with the gamma or brightness settings in game, exiting and going back in?
I take it you went to the dxdiag and ran all the DirectX tests already and everything tested fine?
Does your control panel in windows have it's own brightness/gamma settings, say for your video card? (for instance with my ati card it has catalyst control center that let's you set defaults for your desktop or games, independent of other settings)
Try that. Or you might see if there are updated drivers...