1. I really can't see this is a netfilter problem.
I thought that if packets are bypassing kernel (and iptables in it) then it will be IPtables problem.
2. I don't agree with your reasoning that "both cards are working fine because tcpdump is giving me an output" - everything else indicates that the ISA card is not working fine, because with this in place you have problems; swapping for a PCI you do not have problems.
OK. I'll check it on another ISA card as soon as I get one.
3. Have you checked the interrupts & I/O address range in use by the ISA card, and whether they conflict with something else in the machine?
It's ISA PnP card so it's autoconfigured. I've checked and there is no conflicts :(
Regards,
Antony