This works great with RealVNC and UltraVNC. I think they both use WinVNC.
Anyway, I set my PC screen to 800x600 and the entire screen is displayed.
I tried to play an youtube video in full screen mode on my PC. I also tried to play Angry Bird on my PC.
The refresh rate is slow as expected but functional.
One thing that is an issue is the kindle screen flash. I think the youtube video will work better if there were no screen flash.
Maybe you can add an option to disable screen flash.