There's usually a couple of possible reasons for things like this.
First, the pick is not a default NWN weapon. Going from memory, I think the form-factor of the pick is based on that of axes, which includes things like the way visual effects are shaped. Since the pick has a lot less bulk to it than an axe, that fact sometimes reveals things that would not normally be seen.
Warning! Technical stuff ahead...
Flame and other visuals on weapons are done with some form of particle emitter. These particles are effectively square textures that get drawn multiple times and given a pattern of behavior. In the case of something like flame, there are sometimes multiple particles at work: one for the flame and one for the smoke, each which behaves differently. The squareness of the textures is usually concealed by transparencies, which can make the particles look like they have softer shapes or make them look like leaves or snowflakes.
In the case of the black squares, this is probably how the smoke particles start their life before fading and rising upward, and since the head of the pick does not conceal things the same way the head of an axe would, this transition is more visible.
There can also sometimes be some oddness in how video cards render particle systems like this, particularly if they don't handle the transparency right or if there are sorting problems. I'm guessing this is not the case here, but it can result in something similar...though at that point, you might see it in all particle emitters and possibly in other things like trees and grass.
Anyway, it may be possible to tweak the particle behavior so that the starting texture is not so obvious and dark, but it may not be as simple to adjust the location from which these particles seem to emit. Going on memory here (as it's been a long time since I've messed with this kind of thing in NWN), the particle emitter location may be fixed based on the base type, and as such, we may be stuck with how it is.
