AS 0.741a: problem with RECT NPCs delivering dialogue
From Darth Vader: When you define a RECT as a NPC and let it talk (via playDia) it seems to move, flip or strech... or all three.

Interesting issue. Admittedly, I never anticipated RECTs being used as NPCs, so I probably neglected a sizable amount of logic to account for the circumstance. I think I only ever really anticipated SWFs with talk animations to be used. If you'd care to implement a quick work around, just make a SWF movie with a transparent rectangle and use that in place of a RECT. It will achieve the same result at the cost of one additional media asset. I'll leave this on the bug list as something to be kept in mind, however since it is such a circumstantial occurance with an easy work around, it will be given a low priority.