Ok, I do not know where you guys are going wrong, perhaps your GFX card is interfering. Are there any resolution settings within your respective GFX Control Panels that could affect this mod?
To prove the mod works, I ran a couple of tests tonight. FYI my monitor native resolution is 1920 x 1080, using XP Pro SP3 and an aging Ati X800 Pro AGP GFX card.
Sorry they're rather big.
1440 x 900 first:
1920 x 1080 next:
Not only does this prove that the Res Fix work (without the need for the MS Compat Tool) but it also proves that SH3 looks like sh*te in widescreen.
Keep at it, the most obvious thing is usually the answer.