Resolution problem when connecting to monitor

I've got a 12" PowerBook that I'm trying to connect to my ViewSonic VA720-2 monitor (mini-DVI to VGA).

When the resolution is set to 1024x768, the image fills the 17" screen but is pretty fuzzy.

When the resolution is set to 1280x1024, the images looks great but is the same size as my PowerBook (12" = lame).

Any idea how to get around this issue?

Since I'm unable to find a solution to this problem, does anyone know of requirements for a new monitor...

I'd love to get one of the Apple monitors, but they aren't very cost-efficient. Will any DVI-enabled monitor work?

Getting my 12" PB hooked up to a large monitor is the only thing stopping me from dumping Windows!

I don't know but a DVI monitor would probably work. I'm not really new to Mac but I just don't know.