Under Settings > Project Properties ... I have gone through every single possible combination of Project format (Online, DVD, etc.)... and I've tried creating a new project profile with (also) every possible Compression and General settings imaginable - and cannot for the life of me get 1024x768 for my project resolution. Some screen-casts I'm doing are required to be in that resolution with a watermark in the lower right corner. Because I cannot get the project in the correct resolution, the watermark logo is skewed and looks terrible. Why in the world can I not set my projects frame size properties to 1024x768? Why - no matter what you do - is "User-defined" disabled?
You could create an Uncompressed AVI project.
Settings>Project Properties>Project template properties-Edit file format: dropdown to Microsoft AVI files>Click Edit>General-Set Frame rate and Frame type to match your clip's properties. Then select User-defined: Set Width: 1024 Height: 768>AVI>Compression: None>Click OK.
These settings will create a large file. Once rendered in VSP you might want to use one of the many free converters (Super, MPEG Streamclip, etc) to create a smaller file like wmv, mp4, mpeg-1, etc.
The frame size 1024 x 768 calculates to be 4:3 ratio.
Have you tried setting the project properties to use 4:3, that of course would be standard definition not HD, DV or DVD would provide 4:3 options.
What are you intending to create as the final video?