What are the picture size options with your TV? And what about your video card? Can you adjust over/underscan with it?
My ATI 4550 card also lists the 2310 as the display device; short of connecting directly to the TV, I think this is what you'll always see. I have Vista on my media PC, but try this (if it's applicable to Win 7): In Media Center > Settings > TV > Configuration, select "Flat Panel" as type rather than "Television." This solved a problem I had with player software not displaying as fullscreen within VMC.