I have a laptop with Win. XP Pro. installed. It was used to play a video on the TV and as it was unplugged the Icons in the Start Manager and Text on the Desktop became that small that it can not be read. The folders on the Desktop remained the right size.
Also the buttons top right, Minimize, Restore Down and Close are that small that they only appear as a little dot but do still work.
It is probably using the resolution for the TV on your laptop screen. There is probably a smart feature on the laptop to properly switch between outputs (TV, LapTop, Monitor, Projector, etc.).
The work around is to right-click the Desktop and change the Display Properties, so Resolution, DPI, Colors matches the laptop screen (Display Properties can also be accessed through the Control Panel).