I had the same issue when I first installed Vector Linux 7.0. The tool vasm was able to fix this. vasm can be found under Menu/System/vasm (it can be found in the System section of the Menu). After I used this tool to adjust it, I think I had to reboot, and then when I checked Menu/Settings/Display, I was able to change the resolution to 1084X768 (mine was stuck at 800X600). I may have had to reboot here.
I'm not sure exactly what option I chose under vasm, but it was not the default option (it was a reasonably evident choice though). Sorry I can't be a little more specific. It was a while ago that I installed VL7.0. I'm sure vasm will allow you to increase your screen resolution though.