Just today I experienced this very problem myself.
I also have the CV from when I was a kid which works very well still, I only use that one.
I have several Coleco's that work 'almost' good (a German, UK and French one) often getting distorted images, sprites that are not always right.
Incidently I use the powersupply of one of these systems instead of the one I have in the box.
Anyway, recently I got a modded Coleco from Yurkie and it contains a pause-switch which I use fairly often (its a great addition for when nature calls lol!).
Today I experienced the same corruption when I started the CV. When I received the unit a few days ago it worked perfectly.
At first I thought it was caused by the Atarimax flashcart which I got but sadly the same thing happened when I inserted the original cartridges. And its selftest rom gave a clue 'VRAM Fail'.
I must remember next time to do a search on this forum because thats how I got in this thread

.
After reading possible causes like a powersupply going bad, I got the old one from my box... and... the problem is gone.
How silly of me to depend on a probably much used and worn out powerblock, instead of using the one I had in mint condition in my ColecoVision boxed set.
Thanks NIAD (and others) for pointing me in the right direction.