Set Rage.exe to windows 2000 compatibility mode.
Set Nvidia Drivers to:
AF - Application Controlled
AA - Application Controlled
ASO - off
NLB - clamp
TO(trilinear optimization) - off
TB - off
AFO - off
AA Gama correction - off
AA transparency - off
Vertical Sync - Use the 3D Application Setting
Do not adjust the ingame video settings during a game, do it before loading a game.
In order to adjust the driver settings for Rage.exe you have to click the program settings tab in the manage 3d settings window and add Rage.exe to the list by clicking add then going to the steam folder which contains Rage.exe. Just do a search for Rage.exe.
If you enable extension limit the game will not run. So keep extension limit off.
Vertical sync - Use the 3D Application Setting
I found that there were some graphical instabilities with setting Texture Quality to "High Performance". At "Performance" the instabilities were gone.
Also try using lower resolutions. 800x600 and 640x480 work very well.
You have to use Rage's video settings. Overriding Rage's video settings will cause more problems.
The game might take a little longer to load up, but the Gameplay has good FPS.
If Rage's Vertical sync option will not stick it is because you have Vertical Sync forced off in the Video Drivers Config.