1.) I'm using MAME32 and just went to Options - Default Game Options - Advanced - Resolution Size - 640 *432. The MAME interface will still run at whatever the default desktop resolution is, but when a ROM is loaded, the resolution will change to whatever is selected in this option.
I built the computer myself, but the motherboard is an Abit NF7-S (Rev. 2) NForce 2. Video card is a Radeon 9800 (Non Pro. ATI brand. Bought at Circuit City for 199.99). TV is a JVC AV-27D303.
I'm just using the default 720*480i resolution. This mean I have to scroll the mouse to see the entire desktop, but once playing in MAME 640*432 fills the screen beautifully. As for the shimmering, I seem to get quite a bit if I'm browsing the web, but in an application like MAME I'm truly unable to see it. Because when there is a lot of text, it's crisp, solid, and extremely stable. It's probably not perfect like a computer monitor, but it's as good as I could hope for in an analog setting. I'm assuming that's what you guys are referring to when talking about shimmering, right?