Full screen on 20" iMac?

Is it possible to have games and DVDs run full screen on a 20" iMac? As it is many of my games and DVDs only take up the centre portion of the screen with black space on either side. One such game being NWN. Will I just have to live with the fact that only a portion of the screen will be used? I think the problem occurs because the screen is wider than it is high?. Any help to get full screen would be appreciated.

 

Sorry for my ignorance, but I don't see an ATi control panel in system prefs.

I'm using an intel iMac.
BTW I think the big screen is screwing with my mind. I can't seem to find things anymore.