Everything is entirely playable and the artifacts that appear on screen have no affect on gameplay in any way. The variety of instances of the problem and the frequency in which they occur are all unpredictable with no apparent pattern. The most I could establish from playing is that certain instances are likely and some appear to be entirely consistent (such as the Mario 2 title screen whose example is below.)
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Sometimes the "Four Blocks" will appear every single time but other times it might take a few redraws of the screen for it to happen. That's what I meant by unpredictability earlier.
As for the far-fetched idea that I have a ton of damaged games, I bought Legend of Zelda factory sealed in brand new pristine condition, so I'm rather confident there is absolutely NOTHING wrong with that game. The only game I suspect of having some kind of defect or damage is Guardic Gaiden as no other game causes pixel displacement like that game shows.
Other games indicate no problems at all. For example, Green Beret for FDS played start to finish without any artifacts on the screen.
One last tidbit - as already mentioned, everything is fully playable. I don't have trouble booting games. Games don't freeze or crash. Nothing else irregular occurs. Just the artifacts shown above, nothing more.
EDIT: Assumed to be damage to a component/chip due to heat or power surge.