That is wrong. Do not put the ModLoader folder into minecraft.jar. Move all of the files from within ModLoader into minecraft.jar. If asks permission to copy over files, always allow it.
Okay. It was hell getting the folder in there though, I'm bad enough with computers to make that a hassle.
EDIT: I can't extract into the jar from the folder in the jar. There does not appear to be any way to make this work so far, but I'm not giving up just because I'm an idiot.
What resolution do you play at?
Can't tell atm, I'm at my mom's house. My dad's house has a better computer but the screen is old. Hence strange resolution. I don't understand why the pixels are slightly off the estimate Kingdaro gave; his numbers are probably correct for my screen.
Oh, guess what happened now. "The system cannot allocate the required amount of memory."
Help plz.
EDIT2: Have to reinstall now, because I screwed up and replaced EVERYTHING.
EDIT3: Success! I'll post some pictures of my screwing around with terrain generation at some point.

Woobwoobwoob