Does anyone else have this setup? (and see this problem)
Monitor 1 set at 1024 x 768 (primary monitor - laptop lcd screen)
Monitor 2 set at 1280 x 1024 (secondary monitor - CRT plugged into VGA port)
Wallpaper Position in display properties set to stretch.
Since the secondary monitor is larger in area than the first, the wallpaper from the first is copied to the second with a border around it.
The following problem only manifests itself if IconX is running either by itself or from within DesktopX.
With the display properties set to stretch, the border area is corrupted. But if the setting is set to Center, the border area is OK.