|You can change the screen size by right clicking the desktop, selecting Properties then adjusting the slider. Most folk use 800x600.|
I do however have difficulty seeing this as curing the fault you describe in #3. Whatever size (resolution) you choose it is not normal to have problems fitting the periphery of the desktop and/or the taskbar onto the screen. It's only the size of the items on it that change with resolution.
On screens with title bars at the top, such as IE or OE then double clicking the title bar should bring the edges back onto the screen. I know of nothing similar for the desktop itself.
If I think of something I'll pop back. In the meantime set yourself to 800x600, reboot and cross your fingers.