Without knowing much about the monitor, I think that your monitor is a "widescreen" monitor with an aspect ratio of 16:9 or 1.777' (when you divide the horizontal by the verticle pixles) whereas your setting that you have selected on your graphics card is in "Std format" of 4:3 or 1.333' (again doing the same division).

Try going to the 1280 x 720 as thats a widescreen format and see if it makes it look better.

Hope it helps

Cheers