I have AA on 4x right now.
It really makes or breaks BF2's visual quality. High setting's with no AA looks terrible. 2x AA is pretty much useless. But 4x or higher is what you want to run. It smooth's out the jagged edges you see on buildings & other many sided objects, but particularly buildings.
Dependant on your video card it may or may not have a huge impact on FPS. I can run up to 4x AA with practically no FPS difference.
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