You can see through blocks(especially in the nether, not in the overworld except when using tiny view distance.)This affect disappears when using F1 mode. I use a custom texture pack that changes the grass texture on the side of blocks. The link is: https://dl.dropbox.com/u/110170711/Server%20Texture%20Pack.zip

Show below are images of my view settings and other references.

About 75% Opacity Of Blocks