I found this in a txt file named stderr.txt.
Couldn't set OpenGL 1280x960x32 video mode: No video mode large enough for 1280x960
Falling back to windowed mode!!
I thought Opengl didn't have any screen size limits. I have an Nvidia 8400 and my screen is capable of the 1600 widescreen modes at least so not sure why this text has this line in it, but is apparently the reason this isn't displaying properly for me.
I have discovered that those zips for 3dosound, hires2x and hires4x are supposed to be extracted in same folder that the zips are in and then left right there.
I'm the lead programmer in UQM-HD and have been turning the UQM code inside out to get the hi-res modes working. It's quite a tough cookie to crack and the work still goes on. Hopefully we get it better for the next release!
Most probably your screen is not capable of displaying 960 pixels vertically. (1600x900 is not enough.) Because of this, the game cannot reserve full screen -> it reverts to using windowed mode. Windowed mode can always be started (on most systems), but it has the drawback of clipping at bottom if the monitor is too small.
Fullscreen mode cannot currently scale down, so that 1280x960 would be shrunk to e.g. 1200x900. I examined what the game would look like if this kind of downscaling was used. However, it looked horrible.
This is because the game features a lot of 1 pixel wide/tall details (like the planet orbit ellipse dots in interplanetary view). Since we're lacking a proper downscaling algorithm, these small details are lost at some places, making graphics look quite messy.
So, for the alpha, the best bet is to use a big enough external monitor, I'm afraid. For the next release we will have the 640x480 mode, which will hopefully be of some comfort for laptop users.