Your desktop resolution has an Aspect Ratio of 16:10, you are probably streaming at either a 4:3 ratio, or with a badly scaled 16:9 ?! Try changing your Stream resolution to a correctly fitting Aspect Ratio and the Borders will be gone. (Thats under Settings -> Video)
For example you can use 1680x1050 as your Custom Resolution and then just downscale it a bit to your liking.