Nope, you cannot change the videocard on that laptop (most laptops, actually)... it's built-in and cannot be replaced.
The above isn't a "mod" but instead a temporary stop gap. ATI makes the drivers for your laptop's videocard, which in turn IBM certify them then redistribute them on their website. They just haven't gathered or re-certified drivers in a long while.
The mobility modder tool simply puts your graphic card entry in the ATI driver install so it will install them. This is normally done similarly to how IBM redistributes the same drivers after certifying them.
It's possible your laptop *might* get newer/re-certified drivers directly from IBM as this is a BIG problem for World of Warcraft right now. They patched their game (to suddenly use PS 1.1+ calls) and millions of Thinkpad users suddenly can't even get in to play. Using the Mobility Modder above has made a temporary stop-gap to fix this (and runs great) until IBM gets off their duff and does the same.