I didn't realize you were limited to 640x480 with component input.  Does this mean you can't play vertical games like toobin which have 512 lines?  I also like my desktop at 800x600 even though it's a little fuzzy (a lot of windows non-resizable dialogs are too big at 640x480).  
So far all the Vertical games I have tried look fine.  I just tried Toobin' and it looks fine also.  
I know what you mean with the non-resizable dialogs, sometimes you make a change and you can not reach the APPLY or the OK buttons.  On my setup, I moved the Taskbar to the Right side of the screen and I am able to click most of the APPLY and OK buttons in the dialogs.  
Also, If you use the ATI CATALIST Control Center, I have a pretty recent version and I am able to do the simple Wizard to change resolutions and settings with no problems.  On another PC I have an older version and it is a pain if you are in the lower resolutions.  MAME32 is much harder to use at the lower resolutions because of all the dialog boxes.
Fortunately, I have my settings pretty well established so I don't have to mess with them very much.