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great reply, but what do you mean by "locked to a wide screen"?
Locking the resolution to 1280x720 can only be done if you use a PC to drive the lcd.
It involves using a piece of software called powerstrip that can tell the PC to use a screen mode of 1280x720 within the 1280x1024 capability of the monitor.
In essence it uses the exact same screen timings but only displays the 720 lines of vertical resolution within the available 1024. The monitor thinks it's getting a 1280x1024 75hz signal where windows thinks it's sending a 1280x720 75 hz signal.
In doing it this way the silly monitor "Auto Tune" function won't go and try to adjust to the new resolution thereby screwing up the image. It just thinks it's displaying the same 1280x1024 image it always has.
So, you're now not using the remaining 304 lines of the panel, so you'd have 152 lines of your panel above and below the image unused, even the windows desktop uses this resolution. So you're really buying a 17" 4:3 1280x1024 panel to use as a 17" 16:9 1280x720 panel. The stupid thing is that you can have a good (4:3) 17" for $500. Yet a 17" (16:9) will set you back $700, $200 more for 304 lines less resolution!
The only real reason you'd want to do this is so you can mount a permanent Widescreen (16:9) screen on the wall and not worry about having to move the projector forward/back between 4:3 and 16:9 images to get it to fit properly. 4:3 will scale down (vertically and horizontally) to fit a vertical height of 720 instead of 1024 so it still fits within the screen area.
The need for this is probably negated a bit by the new zooming varifocal lens but I still wouldn't want to get up to adjust the PJ everytime the source changed from 4:3 to 16:9.
I use a PC for DVD, HDTV (with a tuner card), mp3, divx, ps2 passthrough, the lot. The majority of things I display are 16:9 and I found that when I had things in full 4:3 the image was just too big to watch, whereas a scaled down 4:3 image on the 16:9 screen is still nice. I think it works good cause widescreen is bigger than 4:3 which is the way it should be in my mind. 4:3 is a smaller more TV like experience where 16:9 is big and cinema like

The main thing is, with either displaying 1280x1024 or 1280x720 is that it's still in a native pixel perfect resolution (timing) for your monitor so you get no scaling or squishing on HD sources and the clarity remains.
You can just as easily use it in 1280x1024 mode all the time and be happy that when you're watching a 16:9 image it will only use 1280x720 anyway, with letterboxing top and bottom. The only thing here is that you can't easily frame the image.
i.e. All that black at top and bottom will be grey on a large 4:3 screen because that's what lcd's low contrast ratios do, this has the affect of decreasing your perceived contrast levels and I find it annoying.
If you go the 1280x720 res on a permanent screen you can mask the top and bottom with real black hence adding to the overall image quality.
If you get a chance check out the difference between a widescreen movie on a huge 4:3 screen or white wall vs a movie that is perfectly framed to the edges of the screen (i.e No black bars, just the screens black edge). The difference is huge to me.
Anyway. Hope that explains some of it

Cheers,
Arkay.