I'm afraid with LCD screens, your stuck with the default highest resolution as any lower or higher stretches or makes the screen look funny, rather than with CRT, the limit tends to be higher.
It depends on the size of the screen though, as some can go up to a default of 1152x864 and this is actually another standard res.
What windows will have done, is found that monitor in its driver list, and put the maximum to that, so I wouldn't go any higher.
1024x768 is a good size though, and I guess your monitor is either a 15-17 inch?
I hope this helps