640x480 isn't a crazy convention at all when you understand what is required to interface with the display hardware and you remember the goals of TempleOS. He wanted to recapture transparency of the C64 system in a 64-bit system. It's pretty clear Terry didn't want to spend all his time writing vendor-specific device drivers and painful workaround cruft.
This also applies to things like the RedSea filesystem and the way memory is used.
It's his OS - but it would've been nice for games and other things if he had added Mode 13h to the mix - at least fullscreen only - for games mainly. That or ModeX - just something with 256 colors. Heck - he could have added some of the more common VESA modes for that matter.
I was looking thru the source to find the graphics init routines, and I am pretty sure I found it (well - once - probably couldn't locate quickly again) - the thing is such a convoluted mess, and I am not sure how much of that is due to it being an OS and how much of it is due to his style and illness?
At any rate, I think it would be possible to hack this stuff in place (mainly mode 13h - as it's the simplest, and doesn't require much to code for). I think it also needs a way to use the parallel port - mainly for a simple parallel port sound card, if nothing else. Interestingly, if you dig into the various source code examples and such, you'll find a bit about a "HD Audio" system (which looks like a soundblaster interface, if I remember my DOS hacking days) as well as a couple of bits of code for manipulating USB devices (he already supports keyboard and mouse in legacy mode, but nothing else).
Honestly - in spite of his various racist rants and views - this code is begging to be cleaned up and expanded just a bit (it's public domain - so there's nothing he could do or say about it). Overall, it is fairly accessible - just a few other tweaks could make it perfect, IMHO.
Yes, I remember reading that article and thinking how ridiculously complex an OS is. I can't imagine being confident enough to even contemplate starting to write one.