The 2010 beta build contains an option to render the graphics in a window, rather than fullscreen; however, I'm not sure that this feature is an ideal fix for the problem.

It may be helpful to try and further troubleshoot the current setup.

It seems that you're able to get the computer to extend space to the second monitor, but cannot get it to mirror as it once did -- correct?

The predicament is odd. Perhaps it may be helpful to try extending the monitor through the macbook, and from there mirroring the monitor within Windows XP.