Update:

I got a new power supply and the rainbow square did indeed go away, however, I’m still getting sound and video lag every 4-5 seconds when in both nes and atari. I pulled my wifi and bluetooth dongles and rebooted. After that the lag is better, but I still get a similar, shorter lag every few seconds.

I don’t get this lag at all in the older version of the retropie image, just in 3.0 beta 4. I’m using the same roms. Boot to the old retropie, flawless play, new retropie, intermittent lag.

Any other ideas what could be the issue?