I use 1024x768 because usually running anything higher starts making the text and icons on the desktop look too small (using the default windows fonts and not changing it to the large fonts/icons).
I would prob use a higher resolution if I needed the dektop real estate, but for surfing and playing full screen games 1024x768 seems to be the best resolution for me. Then again some people are limited by the size of thier monitors.... i wouldn't want to see a peson on a 15" monitor trying to run 1600x1200...
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