It's 1024x768 not 769.
And 16bit color is 65536 (to be specific
1024x768 @ 65k 16bit color needs 1.5mb video memory.

Goto :
Control Panel Display Settings Advanced and check
how much memory your display adapter has. Some laptops
share memory with the rest of the system; there might be
an option to give it more ram in the BIOS.

I was planning to use an old noname card for multimonitor
to discover that it only has 0.5mb memory