I've had this driver running on all 6 of the Dell laptops I've had over the years, and never seen this.
I just had the screen die on this laptop, so I've plugged in a monitor. But the only two resolution options are 800x600 and 1024x768. I've reinstalled the Intel driver a few times, and while it's installing, the screen flashes to the proper native 1280x1024 resolution for a brief moment, but then never offers it as an option when done.
I had partial success when I uninstalled the driver, allowing the default windows driver (vgapnp.sys) to take over. It gave me access to a wide range of resolution settings, but prevented standby/hibernation, and had no OpenGL support. Then it would be overwritten automatically by Windows with some other copy of the GMA driver every time I would restart. So it wasn't really working out.
I've now reinstalled again, and I'm hoping someone knows of a way to force the correct resolution. There must be a way. How could one of the most ubiquitous graphics chipset/drivers in existence be this broken?
By the way, this is a Dell D520 with a T7200, 4GB RAM, and 945GM chipset.