I don't know Windows XP at all really, but I would guess that there's probably a setting for which screen you're using as the primary display, and setting it to the external one would make it not be wide screen. There might also be a resolution setting that would include widescreen ones, and also regular non-widescreen resolutions that would be streched on your laptop screen but normal on the external monitor. I could tell you how to set either one of those on a Mac which obviously wouldn't help, but maybe it'll at least give you an idea of what you're (maybe) looking for...
But also, why not set your laptop to display text larger? You can do that either by zooming in in a specific application, like if you're typing a paper in Word you can easily set it to display the document as something like 150% actual size, so it's not so small, or you can set the entire display to a lower resolution, which makes everything look bigger.
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