Acer X223W Display - Doesn't work at native res

[BlueSpruceGames]

I'm trying to set up my Acer X223W as a secondary screen for my Late-2010 Macbook Pro, but I'm having problems doing so. The display's resolution is 1280x1050, and that is what System Preferences automatically selects when its plugged in. However, at that resolution, the screen of the Acer external display is totally black, as if it's turned off. When I change the resolution, however, to something like 1600x1200, the display works as expected. However, I want to use the native resolution of the display, because 1600x1200 looks fuzzy. Does anyone know what the problem is here? Is it my Mac or the external display?

EDIT: After messing with the display settings for a few minutes, I got it to work at the native resolution, but now it does this weird thing where it turns on for 2-3 seconds, then turns off for 2-3 seconds, then turns back on for 2-3 seconds, and then turns off again for another 2-3 seconds, etc. What is causing this bizarre behavior?

 

[MacPC]

Usually when you plug in an external monitor to any Macs, it will do the automatic switching. It will flicker a few times, that's normal. But if it keeps flickering, that may be something wrong with the connection or the monitor is not sending the correct EDID to the Mac, have you check the cable? Also play with the Display preference move the icons of the two monitors
in the Arrangement tab. Hope this helps

 

[BlueSpruceGames]

I've tried all that, and it still isn't working. Its not a "flickering" per se, because its more like every few seconds. I've also checked the cables and the settings for external displays in System Preferences, and nothing fixes it.
However, I just tried it my other macs (A late 2011 iMac and an mid-2013 Macbook Air), and it works fine. All three of my macs are running mountain lion, so that doesn't explain why my other two macs are able to use the display while mine isn't.
While watching when the display turns off and on, it appears to be tied to the CPU (or maybe GPU?) usage. When I'm not doing anything and have no applications running, the screen is fine, but when I'm doing anything (even something that requires virtually no resources, like typing this post in Chrome, with only one tab), the external display (but not the laptop screen) goes black for a second or two.
So I can assume its an issue with my mac, but does anyone know how to fix it? I doubt that a less than three-year-old mac would find mirroring its display too taxing to handle (and it isn't - activity monitor shows ~10% CPU usage as I type this). So what is the real problem here?