Well, if your monitor cannot display the framerate your graphics card/processor is churning out, i suggest you put vsynch on for the highest refresh rate your monitor can do at that particular resolution.
as for refresh rate.... thats a matter of personal prefrence
anything under 75 sucks and you can see flicker (well i can)
and i heard that long stints of refresh rates over 120 gives some a headache
me personally, my rather old monitor can only do 85Hz @ 1024x768 which is nice,
and 100hz @ 800x600 which is also extreemly pleasing to the eye
remember its no good your game pumping out 160 fps if your monitor can only do 85...
In answer to your quesiton.. windows sucks, and it couldnt find something optimal if it got burnt in a bong and inhaled, so set it yourself
"Don't be too proud of this technological terror you have created"~Darth Vader, Star wars