I was having the same problem with resolution being limited to
1600x1200. Turns out that in the VM settings I had "Specify monitor
settings" with one monitor specified and "Maximum Resolution of any one
monitor" set to 1600x1200, which is the largest resolution listed. Once
I set it to "Use host setting for monitors" (can only be changed with VM
powered off) and restarted with the VM maximized it set itself to
1920x1080. I don't think this is an issue with xorg but with VMWare
Workstation 8.

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https://bugs.launchpad.net/bugs/969154

Title:
  Unable to set 1920x1080 resolution in Ubuntu 12.04 Beta2 as a VMWare
  Workstation 8 guest

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