"Thin" picture on DVDs:
Something sounds wrong here. You have a widescreen set now. That means that maybe ~half the movies you see (excluding 4:3 TV shows, and very old movies) should fill the entire screen, without distortion or anything getting cut off. Any DVD marked "1.85:1" on the box/disc should take up the entire set, at most a few black scan lines. Only the movies marked "2.35:1" (or wider) should be the ones that lose ~25% of the screen to letterbox bars. It's supposed to be that way for these movies, because they are wider than your set (16:9 or 1.78:1). In order to not have the bars, the sides of the picture would have to be cut off. Still that's better than an old 4:3 set where you lose almost half the screen to bars.
A new TV wouldn't change this at all, in terms of what % of the screen a particular title on DVD (or Blu-ray) takes up. It would just be bigger, if you went larger. Blu-ray will be sharper on your set than DVD. "Upconversion" doesn't really do much, your TV is already upconverting the DVD to 1366x768. A different player may upconvert better than your TV, but the differences aren't usually huge, tiny compared to HDTV vs. DVD or Blu-ray vs. DVD.
What model DVD player?
Do you have your DVD hooked up with component video? (Set of green/blue/red RCA connected to jacks marked usually "Y/Pb/Pr"). Or HDMI?
In the DVD setup menu, there should be a "TV shape" setting. Set it to 16:9.
The TV should have various zoom settings. The one that you use for the HDTV programs, usually "full" or "16:9", but different names on different sets, should work with almost all current movie DVDs. There are some older DVDs that are so called "4:3 letterbox", these will look distorted in that mode. You should use a zoom mode for these that restores the proportions and cuts off some/all of the black bars. After zooming, the same thing about aspect ratios apply; 1.85:1 movies will fill the screen, 2.35:1 will leave small black letterboxing bars. Older 4:3 movies like Casablanca, Sound of Music, use the 4:3 mode of the set (ful height but bars on sides).
Financial:
It sounds like you really need an intervention, get your financial situation in order. If you don't have separate money to pay for emergencies, you really have no business getting new flatscreens, Blu-ray, surround sound. All your money is getting sucked up by what are essentially interest payments. Rent-to-own is like effective 100-200% APR from what I read. This is way worse than paying 25% credit card interest rates which is already bad. You'd be way better off just charging it, then putting what you would have paid the rent-to-own store toward paying off the card balance instead. Though you really shouldn't do that either. Saving and paying in full is the only sane way to go.
You call the bi-weekly bill "reasonable". That's a totally psychological thing you have get rid in your mind. Their rates are completely unreasonable! I think in most states they have to label the goods with total cost of all payments. Just look at that figure, it's totally unreasonable! The bi-weekly bill only looks reasonable to you because they've divided your yearly payment by 26. Lots of unreasonable things look reasonable when divided by 26 but that's a mirage.
If you got rid of the "gotta have it now" mentality, you could get a lot more cool stuff for your money. Say they are making you pay $50 bi-weekly. If you simply deposited that in the bank, separate new account vowing not to touch it, in a year you have $1300. You can pay for a killer 2009 set, and maybe even have a few hundred left over. And are off the hook for the next year while rent-to-own you are still paying. With the money saved the next year, you could buy a killer Blu-ray/audio rig, not just this $200-300 junky Best Buy system. So at the end of 2 years you have a 2009 set + great audio, instead of just a 2007 model year set. The way you're proposing, basically you are letting the rent-to-own store steal your audio system, stick you with an older TV, and steal the HDTV you have now.
Edited by Stephen Tu - 7/13/2009 at 07:47 am GMTEdited by Stephen Tu - 7/13/2009 at 07:56 am GMT