I wanted to add this for anyone frantically googling. I got a new laptop (Dell xps15, 2023), and connected to my widescreen monitor (LG 25UM58 25 inch Ultrawide), and even when I selected the right resolution (the 'recommended' option, which matched what the monitor is meant to show) in Display Settings and updated all drivers, the screen was stretched. The monitor had been fine with my previous laptop.
The problem resolved when I changed a setting on the monitor itself: Using the buttons on the monitor, I went into the screen menu to Settings>General>HDMI Compatibility Mode and switched this ON. That fixed the problem. Hope that helps someone else pulling their hair out.
So if your screen is stretched in Windows 11 and none of the settings or drivers fix it, try fiddling with the hardware menu options too, that might solve the problem.