Ok, there's the problem. Your screen is not 1280x1024. A 16:9 screen is going to be 1600 x 900, 1920 x 1080 or something of that nature, depending on the monitor. How old is that computer? It literally looks like it doesn't support widescreen properly.

You probably need a new video card? Does that computer's video output support anything other than VGA? VGA is the plug that looks like a trapezoid?