First you need to understand a bit about xfree86. The protocol X uses X11 is already very old. Even the oldest apps (more than 10 years old) still work on it. When X was designed there were not much resolutions.
Some things from the past cause "troubles" now. For example the Display sections of your XF86Config-4 file. For example you have this:
Modes "1280x1024" "1024x768" "800x600" "640x480"
1280x1024 will then be used as the main resolution, when you switch to 1024x768 or another resolution then that will become a virtual resolution. The desktop on the screen will still be 1280x1024, but for example only 1024x768 is visible. To access the rest of your screen you need to scroll.
This is a limitation that will be fixed a bit in the future using an extension for X called RandR.
For TwinView the same problem appears. When both screens don't use the same resolution, there will be virtual desktops. Defaultly you can't scroll to see the rest of the desktop. (only when using nvidia's twinview virtual desktops) But when you change Option "MetaModes" "1024x768,640x480" to "1024x768, 640x480@1024x768" it will be a real virtual resolution.
To make a long story short, you won't get a full non-virtual desktop in twinview mode when both screens don't use the same resolution.