The server should be selecting the correct preferred resolution now (it
was known to be a bit buggy in Gutsy), so esp. with comment #9 I think
this can be closed. Please re-test against Hardy, and if the issue
still exists please reopen this bug.
** Changed in: xorg-server (Ubuntu)
Status: Triaged => Fix Released
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Screen resolution does not change in live cd
https://bugs.launchpad.net/bugs/154380
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