This overscan issue has to be considered as a manufacturing defect by
LG. The LG display/TV was recently tested with my dealer by connecting a
HDMi output of a DVD player: the same overscan occured.

By the way, I have now used Lucid Lynx and an Nvidia card (driver
version 173 from Jockey) and the resolution 1280x720 seems to be
correct.

-- 
[i915g] [i915] Screen goes over the edges of display and too low resolution
https://bugs.launchpad.net/bugs/489875
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