I’ve seen too many encodes that have made a mess of this AR. This article has been written in the belief that more and more uploaders will want to pay attention to how their videos look.
At the outset I must emphasize that, biologically, man’s vision is widescreen:

In videology, these ‘widescreen’ and ‘fullscreen’ terms refer to the dimensions of a video picture vis-à-vis the viewing area of an ordinary television screen.
Full-screen means a picture which fills the screen of an ordinary television set having width:height ratio of 4:3 (i.e., 1.33:1, or, conventionally, 1.33).
Widescreen means a picture that is wider than the height by a factor greater than 1.33. It can be 1.37 (like some old B/W films) or 2.40 (e.g., Star Wars - the Phantom Menace). Sometimes this widescreen aspect ratio is generically referred to as 16:9, although the actual proportion may be different. Thus a film with 1.37:1 AR and a film with 2.40:1 AR are both referred to as widescreen or 16:9. The three most-encountered 16:9 (widescreen) resolutions are 1.37, 1.78 and 2.35.
DVD resolution is typically 780:480 (or 780x480 if you so prefer), which corresponds to 1.15:1, even if the movie is a 2.35 AR film. If you were to view the film in this AR of 780x480, you will see a horizontally compressed picture like this:

But when you watch the film in your DVD player, what you see is this:

How is this done? The DVD’s official resolution restricts the movie to a 1.15:1 AR, so it is in the VOBs in a compressed form. The VOB contains a DAR (display aspect ratio) flag, which tells the software in your movie player the actual AR in which to resize the movie. All this, of course, happens without your getting involved in it. Science makes life easier. (And unstable, too, if you remember 9/11).
What happens in a TV? If the dimensions of a DVD-video were to be compared to an ordinary TV screen, it would look somewhat like this:

I have seen some Hong Kong imports (typically the ones churned out by bootleggers) which encode widescreen movies in full-screen for the majority with ordinary TV sets and no idea of AR. Indeed, I’ve seen people watch this monstrosity with relish:

There’s another monstrosity which is, alas, prevalent among otherwise sane individuals who actually spot and keep away from a laterally compressed picture, but succumb to this monstrosity which results from:
1. Keeping the picture proportions intact
2. filling the height of the ordinary TV screen
These two things can be achieved only by
3. Cutting away portions of the picture from the sides:

Those otherwise sane people do this only for the sake of a “bigger” picture because:
1. it is FULL-screen, and not HALF-screen as many of them express it
2. the characters are indeed bigger than the widescreen version
3. the missing parts don’t evoke the sense of loss, because to many what isn’t seen doesn’t exist.
In a variant of this “enlarge-and-crop-and fit”, we have a sub-monstrosity, called Pan and Scan. In this, the cutting camera moves with the main character who stays fully visible al all times, and others are cropped out unceremoniously:
A correctly resized widescreen DVD would look like this, and the characters would indeed look smaller, although much more would be seen around them in comparison with the picture above:

It is, of course, for the individuals to decide what appeals to them, but, other than repeating that man’s natural biological vision is widescreen, there’s only one thing that has to be said in this matter. It is always best to see exactly what the director wants you to see the way he wants you to see. Here’s what Leonard Nimoy has to say on this subject:
When you watch a movie on your television screen, you're not necessarily seeing it the way it was originally intended. As a director, when I set up a shot and say that there are two people in the frame, with the wide screen I can hold both with one person on each end of the frame. When that shot is condensed to fit on your TV tube, you can't hold both [actors]..and the intent of the scene is sometimes changed as a result." - in: Commentary for the Director's Edition of Star Trek IV: The Voyage Home
Movie-buffs always sense that a full-screen movie is, in reality, a widescreen one, even if they have never seen the original version. They fidget, and their mind rebels all the time they are sitting and watching the full-screen movie.
The black horizontal bars that you see above and below the widescreen picture which correctly and entirely fits into your ordinary monitor screen are generated by the software player that you use in your computer. Some will do that always (e.g., Windows Media Player) and some will do that only in full-screen mode (e.g., BSPlayer, or VideoLan Player, the only
non-directshow player worth its salt out there).
4:3 DVD?
Yes, indeed, there are such DVDs. Films which were shot in 4:3 aspect ratio will be made into fullscreen DVDs. Older DVDs of widescreen films used to be made in full-screen with the picture area wide and the rest of the frame filled with some other color (usually black, but I’ve seen a print of My Fair Lady with top and bottom in pink). And then, of course, there are 4:3 DVDs of real widescreen pictures (e.g., The Blue Lagoon), made for a segment of the population who like those enlarged-and-cropped-and-fitted pictures.
Another monstrosity is called “repositioned full-screen”. What is that? It is done with the help of computers, and movies shot digitally (e.g., modern cartoons) are especially good targets for this. It is full-screen, but shows all actors/characters present in the widescreen version by digitally bringing them closer, deleting parts of intervening picture-areas. This here is a shot from original A Bug’s Life:

And this is the repositioned fullscreen version:

Although you can see all the players, nonetheless the ambience planned by the director in the shot gets altered. Some people wouldn’t want it. I know I wouldn’t.
But is widescreen always preferable?
No, not quite. The rule of thumb is: see what the director wants you to see. There are films which are available on DVD in both full- and wide-screen formats, e.g., Total Recall. This film was theatrically released in full-screen. So when a widescreen version was later made available on DVD, it was made by cropping away from the top and the bottom. In this case, therefore, you lose part of the picture by opting for widescreen.
On the other hand, Air Force One was filmed with a process called ‘super 35’, and the theatrical version was released by the director as wide-screen like this:

The picture-area in super-35 frames is bigger, and it requires special equipment to shoot. For the final theatrical release, wide-screen picture areas are cut out by the editor under supervision of the director; those areas may be different in different sequences. As you can see, in the picture above, more were cropped out on bottom than on top.

In this case of Air Force One, you apparently lose part of picture, but that part Mr Wolfgang Petersen never intended you to see.
So, the long and short of this article is:
1. Man’s natural vision is widescreen
2. TV screen is 4:3 or 1.33 (also referred to as full-screen); anything wider is widescreen (also generically referred to as 16:9)
3. It is best to see exactly what the film director wants to show
4. While transcoding a DVD to smaller files (DVD-9 > DVD-5 or DVD > mpeg-4), be especially careful to preserve the original aspect ratio.
I’ve seen too many encodes that have made a mess of this AR. Tin Cup is available as a 4:3 widescreen DVD – the 948.98 MB encode of that movie circulating here has been encoded in 16:9, giving rise to an AVI which looks compressed vertically – it has become wider that the original! Where the uploader went wrong is not cropping the black bars away before applying the AR preference. Many encoders (e.g., VirtualDub, Gordian Knot) let you do that manually, while others (e.g., AutoGK) takes this pain (or pleasure, to some) away by efficiently automating it.
This article has been written in the belief that more and more uploaders will want to pay attention to how their videos look. I’d like to end with a quotation from Jack Lemmon:
With pan and scan, as much as 50 percent of the original picture is lost. It's simple math, folks, something has got to go. And sometimes what is lost is very important. Now how about this scene from 'The Graduate.' Where have you gone Mrs. Robinson? You've been panned and scanned right out of the scene.

Mrs Robinson is right here, although you'll not guess much from the picture above:

Thanks for your patience, and regards.
