Error compiling pixel shader

This error can happen in several cases:

1) You incorrectly installed mods (such as DayZ) which broke the game.

Reinstallation should help in this case. Note that after uninstallation via Steam you might have to delete Arma 2's install folder as well. It's located in \steamapps\common\arma 2

2) The game launches with incorrect / corrupted startup parameters.   

Delete any parameters you might have set. In Steam, you will have to do this:

1. Go to your Steam Library.
2. Right click on Arma 2 Operation Arrowhead.
3. Click on 'Properties'.
4. Under general tab, click on 'Set launch options...' button.
5. Delete everything in the launch parameter field.
6. With Steam running as Administrator, try to launch Arma 2 OA / CO again.

3) You manually installed a beta patch and overwritten OA's .exe file with the beta patch .exe file.

In this case, a clean reinstall should also resolve your issue.