I was using the Fn + F8 and all my applications had a zoomed in font. I contacted Dell and they suggested using the ATI utility to switch displays. In looking at the ATI utilities and shortcuts, it does not have support for this key combination, so I cannot set it up. On another model I have, I can set up the combination.
Based on this information, I would avoid using the shortcut keys to switch displays. I use the profiles setting in the Advanced ATI setup to switch between common configurations.
PS: I have the problem of the extended screen as well and have a technician coming to replace the motherboard and video. I am glad I am not the only one.