Not to worry. I do this with my laptop all the time. There's a bunch of things that could easily go wrong. Every time I plug a different monitor in there's a like a mental checklist I have to go through. Now I'm still on XP on the laptop but I assure you, it is not that Windows 7 is "incompatible" with S-video or VGA.
(Sorry, I couldn't find any screencaps from the 8400 control panel, but shouldn't be that
different from mine.)
1. Check the S-video connection between the laptop AND TV, just to make sure.
2. TV is ON. If it isn't set to the correct input, this will all still work. You'll just have to cycle through inputs/channels til you see the computer screen on one of them.
3. Do you see "Run Multiple Display Wizard" above the highlighted Set Up Multiple Displays?
If so, click "Run Multiple Display Wizard," and that should help you set things straight.
If not, your laptop does not recognize that another monitor is plugged into it. (This option goes away when there is no other monitor plugged in.)
4. As in the following screencap, "1." will ONLY show the option "Only use one display (Single)" when there is nothing else plugged in or recognized. If you see the other options to "Clone" or "DualView," just check one of those boxes. "2." has a drop-down selection list. If another monitor is listed here, you'll have the options to use only one or the other or set which one is primary.
5. If you see nothing indicating that there is an external monitor (your TV) plugged in, then there might be a driver
issue. This also seems likely given that you upgraded to 7 from XP on the same machine, correct? Windows 7 may not have installed a driver for that particular port on your laptop. Click "Start," Right-click "Computer," select "Manage," then in the left pane click "Device Manager." Any yellow question marks will show that the laptop doesn't know what to do with that port.
Beyond that, honestly I've never had a situation quite like yours... I've installed all the drivers
for my rig on my laptop's hard drive(XP), but that was because I hot-swapped the hard drive into the rig itself. I also had each individual driver installation disc, so it was easy... Hm...
Let us know how these things check out!