Hmm, my FS2004 allows all the same screen resolutions that my monitor driver allows. In fact Windows XP did not know about what resolutions my monitor can do until I installed the driver disc which came with it, then it all worked. I also didn't have to take any steps to get FS to show these settings, just installing the driver.
Certainly FS2004 can go higher, I run 1680x1050 now and I know of others who run higher. I think I saw 1920x1080 someone said the ran at.