I tried booting my system with VGA mode, and icon is still garbled. I also tried installing FireFox that seems to work just fine.
What about the attached file. I created it with another icon editor. There is a slight change in the binary file so maybe it will work on your NT machine.
Another data point that I found are, if I setup shortcut to the XWin.exe binary then try changing the icon for the shortcut, icon select window show both garbled icon and X on white icon. I've attached the screen dump as: icon_select.bmp.gz
That's normal, there are two icons in the exe file now: mine and benjamin's.
<<inline: x_test9.ico>>