Yes, I'm using virtual resolution of 800x480 (resolution of the display) as apart from anything it's just easier to use imo. However I'm not sure you are understanding the issue - the pixels on the '7" raspberry pi display' are
not square . This means for example as in my explanation picture if you create a perfect circle for use as a sprite on your desktop PC (square pixels) and then display this same circle on the raspberry pi display it will then be slightly stretched horizontally. This is because the actual shape of the raspberry pi display pixels are rectangular.
I can design my graphics with this in mind (basically create them slightly squashed horizontally) but if I then wanted to rotate that sprite the distortion would be amplified. It would also mean that the graphics would look wrong if I wanted to port the game to other devices.
The ideal solution would be to render the image wider than the display and then squash/stretch to fill the screen but it doesn't seem to be possible. The only option seems to be to have the black bars or use the setscissor() comand but this simply exends the draw area into the black bar area so the graphics are still distorted. My guess is that the AppGameKit developers never considered rectangular pixels as they aren't particularly common so there is no easy way to correct this.
The only possible programmatic solution I can think of is to render everything to an image using SetRenderToImage() and then resize the result to fill the screen but it would add an extra layer of complexity which as this is my first program with AppGameKit I'm not sure I'm ready for.