I have no idea why Windows would boot up at 640x480 if it was fine after exiting the game.
You can rename the ..\Beyond Divinity\Static\intro.mpg file to get the game to automatically skip it on startup, which might eliminate one switch to 640x480 and back, and possibly lower the chance of associated problems.
At least DirectX checks the installed version and skips files up to date, but it would be faster to just not try to install it again. Earlier releases of the games asked to install DirectX, so I assume that must have caused problems with people not being up to date, or something. IMO there should at least be a prompt / option for Adobe Reader, though, as pretty much everyone should already have a pdf reader.
You shouldn't need to run the game in compatibility mode, but since you are having an issue, that is worth trying. The disk version of BD needed to be run in Win9x compatibility mode to avoid a potential bug in Vista/7, but that shouldn't be a problem in the latest version.
