If you have an LCD monitor and set the video card resolution to anything other than the monitor's native resolution, the monitor will make a crude attempt at interpolating to match the two. This results in a fuzzy looking picture. I don't know if that's the problem in your case, but it's worth checking.
Otherwise, as VHG says, it could well be a driver problem. On my test machine, Vista continually insisted on "upgrading" the card manufacturer's Vista-certified drivers with the MS version, which caused all sorts of display problems.