I edited the .ini manually to run at that resolution, but it won't let me. Oblivion had it as an option in it's menus on this telly.

Anyone know how I can fix this and force it to run in 1024x768?

Error reads:
"Failed to initialize renderer.
Your display doesn't support the selected resolution. Plese set a differnet
resolution in Skyrim's Launcher under "Display Settings.""

hmm, that res was not listed in the steam launcher for me. so i changed it in the ini and it appears to be working and that res option shows up in the steam luancher. though it automatically changed the ratio. i think you should only have to change it in the SkyrimPrefs.ini in documents / my games / skyrim folder , but i changed it also in the SkyrimPrefs.ini in the steamapps folder also.

That error usually means that res is not in your resolution list in either display settings/Nvidia CP/CCC. Bit strange as it should be. Try adding it as a custom resolution if it's not there. If it is there then turn it on in windows then try the game.

PS it does work at that res because ive used it.

I'm usin the same resolution and it works for me too. Usin Asus gtx 580 graphic card.