In the December 14, 2004 issue of PC Magazine, Bill Howard wrote an excellent article about the problems with fixed-resolution LCD panels and readability. Since most Windows apps can't deal with font DPIs other than 96 (lazy programmers), high-resolution LCD panels are straining our eyes with tiny on-screen text.
Howard notes that 100 DPI is the ideal resolution for readability, and provides a nice chart that shows native DPI for a variety of LCD panel sizes and resolutions. In the article, click on the link for the 'DPI: Crispness vs. Readability table.'
It's no wonder that my old Thinkpad X24 has such an easy to read screen: the native DPI for the 12 inch 1024×768 monitor is almost exactly 100!