I can give this a rest...after much testing, I've found out that the best setting for my system to run GTAIV is what I've been using all along! I just changed the resolution from 800x600 to 848x480, which follows the correct aspect ratio for my monitor. The benchmark reported 14.99FPS, which is lower than my previous results. Dunno why! The 1366x768 test reported 16.10FPS. Weird...anyway, it's way less laggy than before I started testing different settings even though the benchmark showed reduced frame rate. Oh well, I'll make do with this setup anyway!

Final Benchmark Results For This Session:

Statistics
Average FPS: 14.99
Duration: 37.16 sec
CPU Usage: 94%
System memory usage: 62%
Video memory usage: 58%

Graphics Settings
Video Mode: 848 x 480 (60 Hz)
Texture Quality: Low
Texture Filter Quality: Low
View Distance: 1
Detail Distance: 1

Hardware
Microsoft Windows 7 Ultimate
Microsoft Windows 7 Ultimate
Video Adapter: NVIDIA GeForce 8500 GT
Video Driver version: 185.85
Audio Adapter: Speakers (Realtek High Definition Audio)
Intel(R) Pentium(R) 4 CPU 3.00GHz

File ID: Benchmark.cli

NOTE:

This test differs from the 1366x768 test because I've used [-availablevidmem 2] on that. I'll try that again on low res.