Let's divide this into shaking and flashing.

The camera shake which occurs when you strike things with your fists or a tool is an immersive program feature and can be turned off in the Misc tab of the Settings menu as loewenjenf suggests. It does not work on the camera shake that occurs, as Mharr notes, when the game engine cannot determine which of two opposing slopes your character is standing on. He is also correct that moving or jumping just a little will usually get you out of that spot and correct the shake.

The flashing you refer to seems to be a programmed substitute for pain. When a pesky boar or other enemy hits you there is a red flash which radiates from the center of the screen to all edges. Similarly, there is a white flash when you successfully block a blow. The intensity and radius of that flash appears to vary inversely with one's success at blocking the blow. I tried turning off the options in the Video tab of the Settings menu one by one. None affected either flash.

Jonnin's suggestion of recruiting a buddy to help you test the game. Location, say your neurologist's waiting room, might also be important. Still, it sounds sorta kinda like traversing a minefield without clearing a path first.