Guys, I have a Toshiba A505-S6965, and using your advice I got 1366x768 resolution finally. The resolution is perfect and shows up both in System Profiler and System Preferences as 1366x768, 32 bit. The cursor is, for want of a better word, messed up (not an arrow but a many-colored square which looks like a screenshot in miniature), but usable. Thank you for the detailed explanation. I add the details of what I did:
1. Use OSX86 Tools to install both the ATIRadeonX2000.kext and Dong's RadeonHD.kext from 12/18.
2. Reboot: you get a white screen
3. Reboot again using "Graphics Mode"="640x480x16": OSX says you have to restart (gives screen with only option to power down.
4. Reboot again using "Graphics Mode"="1366x768x32": you get a white screen.
NOW, follow SilentViper's instructions to the letter, viz.:
5. Move ATIRadeonX2000.kext to a non-functional spot (see his post above).
6. Reboot with -x (this is Safe Mode, in case anybody doesn't know)
7. Use any plist editor (Try Plist Edit Pro, google it) to edit /System/Library/Extensions/RadeonHD.kext/Contents/info.plist
8. VERIFY that the change took, by opening it after you make the change (sometimes change will not be allowed, depending on what editor you use and what your permissions are.)
9. Reboot, open System Preferences > Displays, and choose 1366x768, if it is not already chosen.
10. NOTE (IMPORTANT!!): Although you CAN choose other resolutions, at least one of them (1024x768) leads to a black screen and having to repeat the entire above process, so leave well-enough alone!