Solved the problem!
It was a combination of video driver (ATI Catalyst 5.6 has bugs with WMV files) and a few bad WMV codecs/files.
Installed Catlayst 5.5 and manually deleted the Windows Media 9 codecs and reinstalled the WM9codecs.exe and most WMV's play/seek correctly now but a few still had seek problems. Tried a few video repair utils and found running the troublesome files through ASF-AVI-RM-WMV Repair 1.82 fixed all the seek problems.
http://www.repairvideo.com/
So for now all issues solved!