Which display and DVD player are you using? I have the Panny TH42PWD6UY. I run the Denon 2200 DVD via component. When I watch DVDs set for widescreen, I watch it in FULL mode. Normal shows the screen in a 4:3 box, w/ bars on top/bottom and sides.

It could be a combination of your DVD player settings and plasma settings. You may also want to post on AVS Forum on either the plasma or DVD player section. You'll get a lot more responses there.