Oh boy, have I been under a rock?!
Just found this WS mod and it's great improvement to the stretched view.
For feedback here's my setup:
Win7/x64, Sh3/GWX3, Nvidia 9800GTX+, HP w2207h LCD w/ 1680x1050 native&desktop resolution. Have the D3D9.ini set to 1360x768 as mentioned.
Using the DisplayChanger utility (to get solve the Win7/x64 crash issue)
Everything's working pretty good, and I dig Rubini's GUI. Simple and useful. Thanks to all involved in this project