I was able to resolve the issue today!
Having replaced my old Surface Laptop with a new Surface Laptop 3, I bumped into the same issue: my Dell U2414H would be stuck on 640x480 resolution.
My setup is the following:
- Surface dock 1
- Dell monitor connected via DisplayPort to the Surface dock.
The way I was able to resolve this (kudos to my IT support specialist): Adjust a setting of the Dell screen. i.e. I used the menu buttons on the bottom of the monitor to change "Display Settings", where I had to set "DisplayPort 1.2" to "Enable".
That was it - problem solved - full resolution established!