Congratulations - you just discovered a basic flaw in the way TFT monitors work - vis-a-vis how Windows handles display screens, :-((
I suggest you actually try it at 800x600 that you are used to. Some monitors are not too bad at handling non-native resolutions (some are pretty awful).
Set up the display properties for Clear Type and see how it goes.
I've read that the next version of Windows (Vista) will solve this problem by uncoupling resolution from dislay size.