There is a difference between "being able to emulate" and actually "being able to display". The point is that 'out of the box' MAME build can not SET the *video adapter* to display native resolutions, hence AdvanceMAME and similar MAME builds.
I sense you've got some sort of "you damn kids, get off my lawn" thing going on with the new versions of MAME. Trust me, I understand. I'm old too. I'm upset that arcades are disappearing and I'm mad that companies have stopped making CRT arcade monitors. Hell, I can't believe that nobody even makes a 4:3 LCD replacement for arcade cabinets. Furthermore, I'm against widescreen monitors, hi-def, blu-ray, digital cable, HDMI, iPods, iTunes, iPads, Facebook, Twitter, Starbucks, 3D movies, and a host of other things that the "young people" are into these days. But, I digress.
Baseline "official" MAME can run the game at any resolution that the Windows operating system supports*
Read the documentation for "Category 3: Anal video mode types"...http://mamedev.org/source/docs/newvideo.txt.html
To get operating system support of native resolutions in Windows, you need one
of the following...
1) ArcadeVGA video card + custom Ultimarc ATI drivers
2) Calamity's CRT_EmuDriver
patched ATI Catalyst drivers + any supported ATI-based video card
3) Soft15KHz + a supported video card
...then you need to connect your PC to an arcade monitor that supports native resolutions.
With option #2, Windows has 120 or 160 native resolutions to choose from, which is probably sufficient for 99% of the games in MAME.
Without operating system and hardware driver support, there's no way for modern MAME to magically support native resolutions since it's a DirectX based application.
In fact, one could argue that MAME's purpose is to document arcade systems, not to produce an end product that is cabinet-friendly, especially so given the small size of our group.
AdvanceMAME isn't some sort of magic bullet either. The way that AdvanceMAME works is by incorporating custom drivers for a bunch of 10-plus-year-old video cards. You can't honestly expect the MAME team to maintain a stable of custom drivers the way the AdvanceMAME team did. Especially when you consider the fraction of MAME users who actually run MAME on an arcade monitor.
Incidentally, GroovyMAME for Linux does "SET the *video adapter*" to display native resolutions. So if that's a must-have feature, then you're good to go.
Even though us "Category 3: Anal video mode types" are a fraction of the MAME user base now, in another five to ten years, we'll be an exponentially smaller group with even less pull on the project. So my opinion is that we have to learn to make the best of what we have, even if that means we need to embrace and support custom builds like GroovyMAME (please donate). Who knows, if more people donated to AdvanceMAME, maybe it would still be around.* Windows 7 doesn't properly support interlaced resolutions or applications switching between interlaced and non-interlaced resolutions.