As of 7/21/2015, the Steam release supports widescreen natively without issue. Triplehead not tested.
List of widescreen resolutions the game fails to run at:
1280x720 - There is a dialog problem with this resolution detailed in the anomalies section.
<strong>NOTE: These solutions make us of the Retail US version with patch 1.0b, not 1.02 (latest patch), which break swoop races but the game is otherwise playable. To play the sections requiring 1.02, backup your revert your swkotor2.ini and revert the game's swkotor2.exe then once complete change these back to the widescreen versions.</strong>
You can download UniWS Patcher from here.
In game you need to select 1280x960 resolution - that will be your custome resolution.
Besides updating the application you need to modify the swkotor2.ini.
There are two sections that needs to be modified (i.e. 1680x1050):
Of course you use here your custom resolution that you also used with UniWS application to modify the swkotor2.exe.
The menu/options display looks kind of big but are in the right position so it should not be a problem.
The mini map does not function properly in widescreen resolutions so this step will open up the screen space. In the "Options"/"Feedback" menu select the "Mini Map" toggle to remove the map and free up the screen space.
The map works fine.
Stevedroid has created new HUD files that fix the map stretching issue in the HUD. Overall, the HUD still stretches, but this removes the glaring flaw of the map not showing the player's actual position. There are HUD files for 16:9 and 16:10. Unzip and place the mipc28x6_p.gui file in the Override folder found under your main KOTOR 2 installation directory.
I'm basing this on what I had to do to get the game running in widescreen for me. I take no responsibility if anything goes wrong.
Also note that this was done with the latest official patch for the game.
Squizzy Patcher listed below
Steps for installation:
1. Backup your swkotor.exe and swkotor.ini files
2. Backup your mss32.dll file in your KoToR2 directory.
3. Extract the new mss32.dll file from the Windows Vista Fix in to your KoToR2 directory, replacing the one that is already there.
4. Extract the swkotor2.exe and the resolution patcher exe file in to your KoToR2 directory.
5. Run the resolution patcher from your KoToR2 directory, set the resolution you want, and patch.
That should do it. Be sure to check your swkotor.ini file and see that your wanted resolution is in there. If not, change it.
The lower-screen dialog does not display in a 1280x720 resolution. This renders the game unplayable at this resolution as selectable dialog options cannot be seen by the player.
The mini map is misaligned in widescreen resolutions.
The HUD and all two-dimensional elements sans text are stretched.