Yes, I use 1680 x 1050, so that would be great, but frankly I would change it to have this menu working. *chuckle*
As I read somewhere earlier (here or on MGE thread) that only aspect ratio of video is significant, and not resolution, so you don't need to change it if you have the same aspect ratio of screen resolution as aspect ratio of main menu video.
For example if you watch a movie from (SD)DVD on your computer you don't need to change resolution of your screen, and those movies are 720?576 (4:3) for PAL and 720?480 (3:2) for NTSC. They are stretched to screen size, and you don't see 'pixels', because video decoder interpolates pixels that are in between. The same would be for these videos, except for aspect ratio.
That's why I said the resolutions
1280x[
720|
768|
800|
854|
960|
1024] for main menu video would be the best (and not taking as much disk space as for 1600x1200 or 1680x1050), and 1280x720 is the standard of HDTV-720p (though not Full-HD).