Two things to try. Slide the image of the man and woman left or right. It's possible that you have inadvertently copied an even over another event. From your example it looks like man/woman is partially covering a second event. If this is not the case, open the man/woman event in Pan/Crop, right click and select "Match Output Ratio."

Nothing worked. I don't think that I copied an event over another event because all the new clips I started adding look the same when the preview is on Best. It looks like when I set it on Draft the video sort of moves to the upper left corner and it looks fine. I tried rendering it, but the problem remains. I can't find the displacement effect :/

I tried cropping it and sliding it to fill up the screen, but this is what I get

https://imgur.com/a/BiJegKX

Try this: open a new instance of Vegas. Add a different clip than the one you're having trouble with. If it looks o.k., add the problem clip. If the "problem" clip still looks like what you have showed us the problem is in the clip and not in your Vegas settings.

What FX are applied to track 8? (I can see the fx icon is green.)

I tried doing what you said and everything is ok, the problem has to be with Sony Vegas settings. The track 8 has saturation adjust.

These are my settings

https://imgur.com/a/lE1OoCF

I noticed that when I turn on FX bypass everything goes to normal, so it has to be an effect, but I looked everywhere :/

https://imgur.com/a/J1all5l

Sorry, momentarily mixed up your issue with another....

Did you apply an fx as a MEDIA FX? (Must be somewhere if fx bypass fixes problem.)

Maybe this is another "FX before Pan/Crop" issue?

I didn't apply fx as and MEDIA FX, I double checked it and I found nothing.

I think I added some fx before pan/crop, is this the problem? How do I fix it?