W2K3 server RDP Resolution issue

Whenever anyone, myself included, tries to use Remote workplace or RDP to access the network from off premises the screen comes up small and bordered (or framed) by black. Initially I thought it was differing screen resolutions between the remote stations and the host. But after trying several resolutions from windows XP, Windows Vista and Windows 7 machines the problem still remains. I’m somewhat convinced the problem has to be coming from the server’s Terminal service settings but have been unable to locate settings to adjust this feature.

Has anyone seen this? How have you managed to correct or workaround it?