When the game initialized it tested my hardware and said it was going to use High, 1280x720 [Letterbox]. When it started up it went to full screen 1920x1080. No matter what I set in the Video settings the screen never changes. Even if I choose "Low" it still comes up in full detail etc. at 1920x1080. This would be OK if my video card could handle it but it just can't. The card is an NVIDIA GTX260 with 4megs, and I know from playing Fallout 3 that the 1280x720 is all the card can do. I have no idea what the frame rate is, possibly someone can tell me how to find that out, but I get a LOT of screen flicker.
Does anybody know how to overcome this problem?

My computer is an i7 920 with 12 gigs of ram and WIn7 64 bit so I also have all the other common problems: lost autosaves, crash on exit, bad flicker around other characters, etc. etc.

check and make sure you (and the game) have admin rights set for the My Documents folder under your username. It sounds like Windows is stopping NV from modifying the .ini file that changes all of the settings.

Or, you could manually change the .ini settings yourself if you know how