For a 17" screen the resolution is good for me.... I prefer to keep lots of obects on my desktop...and have many windows open at what would be an optimal size for each so as to have most things on those screens visible without scrolling. 1280 X 1024 is the best ratio for me.
Had I a 19" screen, id go higher...but higher on a 17" screen just makes things too tiny and hard to read.
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