without wishing to butt in, and knowing raze among others know a crapload more than i, i DO know that for some people the config.div doesn't come up correctly because it's being interpreted as a DivX movie file.
the fix would require NOT having your divx movie player set to be the default for running *.div(x) files.
an alternative is utilizing a hex editor to open the file and set resolution manually (like many of us did to attain 1280x1024).
or...
perhaps starting the game and then shutting down your computer. this would pop-up the message 'BD was shut down incorrectly, would you like to run configuration again' (or something along those lines)