What if you try:
MCM_CR = MCM_CR_SRAMLAP(3) | MCM_CR_SRAMUAP(3);
AXBS_PRS0 = 0x1032;
No luck with this one either. The new SD card also didn't change anything.
Now the good news is I managed to get rid of the issue completely with a very simple change! The bad news is that it's not very elegant :(.
In an effort to definitively rule out a bad chip, crosstalk interference, or anything along those lines I decided to try the teensy at a lower clock speed to see what (if any) effect it would have on the issue and boy did it have an effect. Instead of a few rainbow flickering pixels here and there, the whole blade was a jumble of flickers while extending and retracting the blade.
So... if a slower CPU makes the problem much worse, perhaps a faster CPU will make it better? It sure does. Changing the clock speed to a 120mhz overclock fixes everything. Kind of a brute force bandaid, but successful nonetheless.
I ran it for a little while to see if there would be a concern of overheating but the chip doesn't even get warm to the touch so it doesn't seem like 120 is pushing it to the limits at all. Plus, since this isn't a continuous duty device I think the overall impact of the increased clock speed will be negligible.
This solution would also explain why swapping out the Teensy to a 3.6 has fixed the issue for some.
I can't thank you enough for all your help with this. Hopefully someone else will find this info useful as well.