Yesterday after I found this thread I had a short look at the Micropolis source code and various bug reports and it seems that the screen resolution is hard coded or at least tied to hard coded steps. The one closest to what we need is something like 800x600 but of course that means that parts of the screen are invisible and scrolling down might not work.
Adding additional screen resolutions is on the ToDo list for several years now but it doesn't seem to be implemented. And since the project seems to be dormant (to avoid saying it's dead) I doubt that this will change.

Isn't there a Lincity(ng) package in one of the extra repos? I suggest trying that.
I'd like to check that but it seems to me that apart from the forums maemo.org is currently completely dead. I'm not sure if that's a technical difficulty, a first result of what has been discussed in the "ask the council" thread of if it's just my browser that's messed up.