Can you try the same monitor with a different computer to check whether the monitor or computer is at fault, and try using a different monitor cable to rule out a damaged cable?
Might you have changed the settings on the monitor itself by pressing buttons on its frame, or done something that caused it to reset to the default settings? Or perhaps changed the font smoothing in the OS preferences (I think it might be in the Appearance section if that still exists)? You could try booting straight from the installer cd to see how the default OS display settings look.
Have you accidentally engaged magnification somewhere, either in the OS (you'd probably notice the screen scrolling with the mouse if you'd done that) or in the application you are using?
You could try reconnecting the monitor cable or even reseating the graphics card. Also check that you don't have anything near the computer or monitor that could cause interference, such as the magnets in big loudspeakers or someone vacuuming nearby, or perhaps lots of cables running closely parallel to the monitor cable.