I prefer 1280x1024. However, with my XP box I only have a 17" monitor and so I have to keep it to 1024x768 to keep all the type legible.
The other problem with my XP box is that is has an Intel onboard graphics chip. It will do 24 bit colour depth but it's terrible sluggish so I'm forced, most of the time to use 16 bit.
On the other hand, my ME box has a Radeon 7000 graphics card and can handle 32 bit no problem. But, for some reason, I just can't upgrade the OS to XP.
Oh well!