I use classic snapping exclusively. Under Windows 7 the "snap tips" appear and disappear so quickly that I cannot read them, but with the same release of ArcMap on XP they were working fine. I can see that the cursor has snapped but I have to jiggle the mouse around and watch carefully to catch the snap tip. Really, even watching very closely I have to see the tip several times before I can read it. (As before, the tips appear next to the cursor and/or in the status bar.)
I have the same issue, and no helpful suggestions :( I have always used "regular" / new snapping. Just switched from Windows XP to Windows 7, and the "new" snapping doesn't work well anymore, so I switched to "Classic snapping" -- and those snap tips are so dang fast, I can't read them at all, just see a blink so I know there's a vertex there and hope it's the right one.