Vista Tutorial - Re : HDMI Video problems With ATI Radeon HD 3200

I have AMD Phenom X4 desktop running Vista 64 bit with 4GB Ram.
The Graphics Card is ATI Radeon HD 3200 with 780G chipset.
The monitor is ASUS 23.6" HD ready monitor with HDMI input.
The Card also has HDMI output but when i connect the monitor with HDMI cable the resolution suffers, images are blurred & the screen size reduces. I have black borders on all 4 sides. The only good thing is color intensity increases.
The driver s/w version is 8.531.0.0
The monitor works well in VGA mode & tested it with other HDMI inputs - it works well there.
Just the HDMI output from PC has problems

Any suggestions as to how i can get a true HDMI video & full screen?
Regards

the radeon 3200 is an integrated video solution. how much ram is set aside for the video right now? you should have the option in bios to allocate more ram and if so, allocate 512mb or as much as you can. secondly, download the latest software drivers from amd: Drivers & Tools | GAME.AMD.COM

I tried installing the driver from AMD - Version 9.6 59.7 MB - got an error message : Application Install: out of disk space
No idea what this means.
The card can use more than 1G of memory if needed from the system.
I have 4G with 3 more from USB flash drive thru speedboost.
More likely the problem is driver

There are 2 options at the site - tried both - have the same error message : Application Install: out of disk space
The total dedicated video memory for the card is 256 MB - shared system memory is 1663 MB for a total of 1919 MB