Why is my computer locking up with external display connected?

I just got my MacBook Pro about 2 weeks ago and everything works great. I have this shiny external monitor and I finally got the Mini Display Port to DVI dongle in the mail today. Plugged it in (computer already on) and everything appears to be operational.

There are two issues using the external. Upon restarting my computer with the external display connected, I can boot to the login screen (up until this point my external is blank). After I type in my password and hit enter, both screens go into a grey screen, indicating OS is loading however, it fails to do so. If I unplug the external, nothing changes. I must hold down the power button to power down the machine.

With the external unplugged, I can turn on the laptop and everything operates as normal and once I am in OSX I can plug the external back in and I am good to go, editing photos, etc.

BUT! I was trotting merrily along using both displays and all of the sudden both displays go blank, the external showing a light pink and the built in display showing a green. Again I must hard boot.

Obviously not a functional setup. Should I blame the knock-off dongle from Amazon? Should I go ahead and pony-up for the Apple dongle? Thanks!