CloneDVD Mobile to iPod resolution options

Why would one transcode a DVD to a higher resolution than the iPod video’s native screen resolution of 320x240? Wouldn’t any additional resolution be “wasted” as it is scaled down to 320x240 (native)?

In CloneDVD Mobile, you first select the target device, in this case, iPod, then are shown an option to transcode the movie at greater than 320x240. Why select a higher than native resolution? Unless there is some good reason for doing this, the program should not show the greater than native resolution option.

1.) To play it on your TV with the iPod Video Out
2.) To “zoom” into 16x9 videos.

What resolution and quality level would you rip your DVDs to if I wanted to play these on a tv using the composite video out of an iPod?