Two possibilities/ideas (but note I do not know for sure)
Have you tried reducing the refresh rate? - maybe at that res the monitor cannot support it
[Does anyone know if you can use SwitchRes with the Screen spanning doctor?]
Also does your iBook have sufficent video memory? - to support 24 bit colour with 1680x1050 external and 1024x768 internal, you'll need at least 7.6 MB - I know your 'card' will have at least this, but I am not sure if you need a lot more - just an idea.
EDIT: Have you looked at the SSD forums :
http://forum.macparts.de/viewtopic.php?t=998 - seems you can go to quite high resolutions