same problem here, using a clean install of 7.04 and nvidia ti4200 with 
nvidia-glx drivers from repos.
when i select "switch user", either with compiz or metacity (it makes no 
difference), gdm resolution is scaled down to 640x480.
if i log in with another account, i am not able to change it.

i modified xorg.conf this way:

Section "Screen"
        Identifier      "Default Screen"
        Device          "nVidia Corporation NV25 [GeForce4 Ti 4200]"
        Monitor         "SyncMaster"
        Defaultdepth    24
        SubSection "Display"
                Depth   24
                Modes           "1024x768"
        EndSubSection
EndSection

but there was no difference.

-- 
Switch user causes screen resolution to change
https://bugs.launchpad.net/bugs/44562
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