I had the same issue with RH9.
Are you doing the change logged in as root, or as a normal user?
To get around this, I had to edit the XF86Config(-4) file. This is the file that configures your xserver. You will need to either be root or sudo to edit this file. It is usually in /etc/X11 directory. Go to the section for your screen and make sure the first resolution listed is the one you want. If you want this for the root account, you may have an XF86Config in the root's home folder. This will need to be edited as well. Once this is saved, just CTRL-ALT-BACKSPACE to restart the Xserver and login. Your new settings should stick.