I have this tv and am using an ATI AIW9600 card. I spent quite some time configuring the tv to run with Component using a dongle. After reading everything I could find on the subject, it turns out that there are some sacrifices (at least I haven't found a solution) when using a tv. I'm running Mamewah at 640x480, but the best screen resolution for everything else, including games, was 640x432. I got this resolution using Powerstip. The negative is Mamewah gets cut off slightly around the edges.
I know this doesn't solve your problem, but at least you can see others are experiencing this as well.