I was making backup copies (GENERIC/Xvid) of Step Brothers and Hancock, two sony titles at CBR of 2.5mb/s. The backup was pillarboxed (black extensions encoded to the left and right). When it played back it was scaled to 4:3 instead of 16:9 (in appearance). The truth is that the extended edges caused it to be so.
To resolve the issue I went into "Conversion settings", "advanced resolution settings", "crop settings", confirmed all the values (did not change any), and continued with encoding.
The result was cropped properly.