you can try running lower but the picture WILL be bad, have blur and lag (image processing in the LCD's display processor)
I've had this problem. I read that XP has some refresh rate lock or something that Q2 can't override. These guys were discussing fixes before the quakecon tournament. I downloaded the program, set my monitor res to 1024 and refresh rate to 75 and I haven't had a problem since.http://www.quakecon.org/forums/showthread.php?t=2945&page=2&pp=10