I have removed the xorg.conf file alltogether and everything works as you predicted - better in fact after I threw out the vga cable and used the hdmi cable instead. The latter effect being that I default to the correct resolution.
I still need to step the resolution down in order to quit the X enviroment. If not, I crash. With Wheezy, changing the resolution doesnt stop the crash when I logout/reboot/shutdown/etc. It would appear that I am not the only person with this problem.
There is not much I can do except wait for an updated kernel or patch or something. Apart from this, the system is rock solid.
Thanks again for your help jggimi. I probably owe you a beer!
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