I had a similar problem trying to set up a second monitor, one wide screen, one standard with a old x300 ati card and windows xp.
THE ONLY solution was to download the catalyst drivers/control panel. that solved the problem, even though windows said it had the latest drivers it could not set up the higher resolutions without the download.
unfortunately, his gfx card does not even has DVI output. just VGA... I hope when he buy cheapest gfx card [20-30 euros], it will be able to chose 1640 x ... resolution? His gfx card seems pretty old, GeForce... can`t remember the mark now...
Not knowing which monitor was purchased, it's possible it doesn't support a resolution of 1680x1050. There are quite a few 19" widescreen monitors that do not support anything above 1440x900. Just a heads up.