I tried LFS in 800x600 resolution, and also in 1280x768.
It's really strange that there was no difference between FPS. Max 32 and 7 at the beginning of the race
Try this, it is what I had to do as I horrid framerates that were completely unplayable. Go to your display properties (right click on desktop and select display in case you don't know). Go to the settings tab and click advanced. There you will see a Troubleshooting tab. Click it and you see a hardware accelleration slider. Click that down one notch. I have to have it clicked down one notch or I get terrible FPS. You can also possibly play with the sound accelleration slider. You can find it by going start>run and type dxdiag. Go to the sound tab and you will see it there. Those may help.
Screen width affects LOD option set to yes fixes it for me.
I am not sure if you should set it as no, if you have non-widescreen monitor. I am not 100% sure, but I think I had it off before I got my widescreen monitor.