According to XDA Developers, the HTC Touch HD, sporting a 5 megapixel camera is capable of taking 7 megapixel panorama pictures instead of the default, less than 1 megapixel stills.

In order to achieve this, you need to edit your registry as follows: navigate to HKLM/Software/HTC/Camera/P3 and change the value of MainCamCaptSize to DWord value 1024 and the value of MainCamSupportCaptSize to DWord value of 1744. Don’t forget to soft reset your device in order for changes to be applied!