What setting to output from a laptop to a 16:9 HD TV??

I have just bought a 42” Panasonic plasma tv (res up to 1080p) and I had a question about using it as a computer display.

I hooked it up to my laptop (pc with win xp home) and used a vga cord to get the picture happening.

The picture, however, is ever so slightly squashed (ie people look slightly shorter and slightly fatter)

My lap top is a widescreen model and when I check Properties>Settings it is set to 1280×768.

I am able to change the aspect ratio through the tv itself but can only toggle between 16:9 and 4:3

4:3 is also almost correct but again the people look slightly taller and skinnier.

Is it a matter of adjusting the display settings of the laptop through Properties>Settings to get the correct fit?

I could do it by trial and error I suppose but I have to restart the computer each time you change the resolution and it takes 9 years to reboot.

Do any of these settings look like they might be the one?

800×600
1024×768
1152×864
1280×768 (the laptop’s default setting)
1280×1024
1600×1200
1792×1344
1800×1440
1920×1080
1920×1200
1920×1440
2048×1536

Thanks for your time.