When do I have to calibrate my 5D2?

Soft means as if someone put a thin layer of petroleum jelly on the lens. everything is soft, subject and background.

Funny part is that clips were accepted in several agencies.
Yet I feel that the video is much softer than what it used to be.

Sounds odd, I'd also recommend joining the Canon Professional Services (CPS) Silver membership is $100 and comes with 2 free cleanings & checkups along with a bunch of other perks. Perhaps your cameras slowly going out of back focus? Actually, I'm not even sure if you can adjust back focus yourself on a DSLR. Are you doing any shooting that has the camera under heavy vibrations?

I carry the camera a lot in my padded backpack. Recently I felt the backpack was too heavy for me and I bought one with trolley. Then I shoot time lapse stills and other clips. There is no CPS in my region.

time lapse stills are killing your camera and are mostly sure the cause of softening

I agree.

I have thought about buying a cheaper Canon body for time lapse and keep the 5D2 for stills and regular video.

You should be able to ship your camera in for service somewhere. Also what is your shutter count at? Might be time to fix/replace after all the timelapse. (You can use EOSInfo to check)

My shutter count is at 93,700. Shipping for service is too complicated. It is expensive (insurance) and there are some taxation problems.

The camera was found to be working properly by two Canon reps. They could not confirm or recreate any problem. I only paid for cleaning. The images are razor sharp, but the clips are softer. Yet nothing was rejected. I am going to rent a camera from a camera rental shop and compare the performance of the two. Maybe it's only in my imagination.

how can timelapse make it soft?

can you guys post some pics of 'soft' images... does it just look like you aren't getting tack sharp focus? or does it look like you might need a tripod?