I have a Thinkpad Z60m with a 1280x800 LCD display. system-config-display (during firstboot) defaults to an 800x600 setting (rawhide 2006-06-16). I had to check the X log to see the actual resolution was 1280x800 (I couldn't remember). X obviously properly detects this; somehow, system-config-display needs to as well and then default to the native LCD resolution.
This should be fixed as of s-c-d 1.0.45-1 and later. Please reopen if this bug recurs for you.