Typically any visual quality issue in playback like blockiness, stutter, or visual pulsing at regular intervals is due to how the stream is encoded. For the pulsing issue, you can review the video encoding options of the source encoder. Things like bitrate, keyframe interval, and H264 profile are the first things to check. Setting too low of a bitrate can cause this issue in most cases, to solve it try increasing the bitrate in small increments to test how high the bitrate needs to be in order for your type of stream to look good.
If the stream is transcoded with Wowza Engine Transcoder using NVENC and you tried manipulating the bitrate along with other options and you are still seeing the issue there is an encoding parameter that can help.
You must use a text editor to configure video parameters in the Transcoder templates ([install-dir]/transcoder/templates) in your Wowza Streaming Engine installation. They can't be configured using Wowza Streaming Engine Manager.
Open the Transcoder template in a text editor and add a <Parameter> section to the <Video>/<Parameters> container in each <Encode> block that you want to modify, as shown in the example below. A single template can have multiple <Encode> blocks (one for each encoded bitrate in the output stream). Add the following Parameter:
<Parameter>
<Name>nvenc.rateControl</Name>
<Value>0</Value>
<Type>Long</Type>
</Parameter>
Next, save the .XML file and restart Wowza Streaming Engine. This Parameter forces the NVENC encoder to use a different way of controlling the bitrate of the encode and can help in some situations.
More information on using parameters is outlined here: https://www.wowza.com/docs/how-to-control-transcoded-video-with-video-encoding-parameters