No stupid questions. We all had to learn sometime and somehow.

What kind of card is it that it can only support 1600 x 1200 (that's not too uncommon for a 6 or 7 series nVidia) but 1360 x 768? That's odd.
Two 19"s would be FAR better than what you are using. You will need to horizontal span them if you are using XP.

The TV will probably not support anything higher. It is a TV, not a monitor. You don't physically have enough pixels to (in my opinion) make this look "right". You COULD modify your UI, change the fonts, etc to make it less "squished" but in the end I don't think you are going to be happy long term. But it's your game experience, not mine :)

I have written about this before in these threads:

One huge Screen?
Xzin, how do you have two PC's hooked up to a single 30&quot