I myself would keep it simple and start from there, even that is hard if money is the issue..
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My first guess with my crystal ball is, that your video card is probably not supported as good as it should. Try 1024x768 as that's a resolution the regular vga driver should be capable of providing.To quote your reaction, and in order to find a work around, i can hardly explain how, but it looks like if i get at one point 640X480 as a screen size, it almost looks like you are looking at an old monitor capable of showing 320X200 and when moving the mousecursor to the far end of the screen, the background slides along till the whole 640X480 area is shown, and getting back at initial left upper corner it goes the other side... Kinda wonder if i try to find another videocard, this problem is solved, but i am going to try. It has a dvi connector to it.... Ahwell, i'll try....