Sorry, I don't have access to my STW disk to load up and check. I do recall there being a resolution slider though. I think that last time I played it I was running Win 7 and the only issue I recall was a crash on exit (and if you are going to crash, that is the time to do it!). Have you tried the compatibility mode? That is the only other thing I can think of.

As for the lego bit, it is hard to avoid on such a big monitor and low resolution, but even so at highest resolution, STW was not built to zoom in really close to see the facial expressions on the combatants. You are just maneuvering formations and you can watch individuals from above, but not in any kind of detail.