I can't imagine programming on a 640x480. The scrollwork would be nuts..
I had to work in 640x480x4bpp (16 colors) on my 486 with 24MB of RAM... and this was running windows 98 and Visual Studio 6. It worked OK, I suppose. When I got my K6-2 (and after a while, finally did my first ever install of windows 95 or higher) it automatically detected the ATI rage pro that was in the machine and installed the drivers (this was really a pleasant surprise) and I was able to use 1024x768, which I considered mega-high resolution at the time. (I still consider it rather high, certainly workable, depending on the program). The monitors I was using were crap though. most of them couldn't even go higher then 1024x768 anyway. This LCD was the first monitor I got that was capable of anything higher (well, without threatening to explode or giving out a constant,loud tortured scream).
Also, the LCD was a gift a few Christmases ago... (or maybe a birthday present, can't remember), and considering the tech skills of the gifter it was a really good choice.
I haven't had any issues with screen real-estate in any of my development; scripting in editpadpro, VB6 and Visual Studio 2008 get along with the size just fine.
Also: at least one thing can be said for smaller resolutions & programming- it makes you write shorter code or break things up into procedures, which is a good thing in the long run; certainly not something to use low resolutions for on purpose, though.