Holding warhorns causes the graphic glitches seen in the picture and removes the toolbar on the bottom. Not holding one in hand fixes the issue. I also blew on the Rivendell horn and it didn't seem to spawn an invasion.
The second picture is without mods (damage indicators, journeymap, schematica, better HUD, dynamic surroundings, MPM2, tabbychat. Core mods for NEI and others still in though). It is not as exacerbated, but there's a floating head. Seems to occur only in third person.