VGA mode is what PCs use when there is no video card, or the video card has failed. It is "Low Resolution" in that the screen, (the display on the monitor), is at 640x480 screen resolution and 16 bit or 256 colors. 640 x 480 means the display has 650 pixels down and 480 pixels across. Resolution is poor, meaning edges and corners are not defined very well, and colors are limited.
Compare that to the general resolution of monitors today, for example I use 1280 x 1024 32 bit colors, (I think that 32 bit means about 16 million colors). But VGA cannot do that, and that's why we have video cards that replace VGA to give a better display.
More about VGA here;
http://www.wisegeek.com/what-is-vga.htm
What your friend suggested you do was, in fact, reboot the computer into it's Safe Mode. That automatically disables most drivers and only loads up the operating system using basic drivers. This includes disabling the video card and drivers in favor of generic VGA mode, and that's why the display seems larger, the icons are larger and less well defined. Safe Mode is a diagnostic mode to help the user diagnose problems.
Rebooting back into Normal mode returned the system to using the video card and drivers, and no 'turning off' of VGA is required. It did that automatically.
Not sure where you are with your monitor. You mention that you now use a CRT monitor, but the AOC e940Sw seems to be an LCD monitor, not CRT, and the max screen resolution is what you are using, 1366 x 768.
Displays do disappear sometimes, for short periods. My dual monitor display on my Windows 7 system failed a couple of weeks ago, I was working on the system and both monitors flashed, returned, and Windows popped up with a message that there was a problem with the display driver and Windows had restarted the driver.
If it started to happen regularly, then I would get concerned, but that was the first time for 6 months so I am keeping my fingers crossed.
Windows 7 is better able to recover from such temporary failures than XP ever was, so when your system had it's blip, your only choice was to reboot. You could have looked at XP's Event Viewer, to see what event took place then and you might have seen some driver or other had failed.
It 'could' be that the video card is on it's way out, so its a good idea to be prepared for that.
Generally monitors don't need special software installed to run them, so compatibility should not be a problem.
Mark
Hi! Got a few questions.

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