Sorry to revive a dead thread, but I didn't see any point in opening a new one.
I tried choosing another resolution by changing the "Graphics Filter" option, but I keep getting the error you can see in the attachment. I tried all options available, but only the default resolution works. My card is a GeForce 330M.
This might be a stupid question, what is the resolution of you monitor?
Basically, for one reason or another your graphics card is refusing to switch to 1280x960. Given that it's a relatively common resolution, I'm wondering if it can't switch because it's too big for your monitor. Alternatively, it might not be included in the resolutions list for some reason.
Try adding it in your graphics card driver control panel?