Why the small "letterbox"

I've got a new Panasonic 42" Plasma 1080p. Players are Oppo 980, now 983.

I've tried several older DVD's. Some are so beautiful, with the 1080p upconverting, it's hard to imagine them being any better. The fill up the screen in "full size" mode and seem to work perfectly.

At least two movies do NOT fill up the whole screen in their "full size" mode. There is a letterbox, and it looks sharp and clear, but has black bars on sides and top and bottom. The movie uses probably 70% of the screen.

I can zoom it to full size and it retains the full image since it has the right proportions, BUT, when zoomed it loses that razor sharpness. In it's smaller letterbox size it looks pristine.

Even odder, the standard information at the beginning of the DVD, prior to the first menu, DOES fill up the full screen. It's only when I play the movie that it shrinks.

I've tried every combination of settings imaginable, on TV and DVD player.

Have you ever seen this happen?
Any idea why?

Hint: In the case of "Don Juan DeMarco", one movie where I have this problem, it's a double sided DVD where one side is 4:3 and the other side is letterbox. The 4:3 side behaves as you would expect 4:3 to behave (is it 4:3? I forget but you know what I mean). That is, it looks pristine but has bars on the side where material was cut away.

Playing the letterbox side literally delivers a smaller movie, but all the material of the original width. It's almost as if the DVD thinks I have an old 4:3 CRT and is trying to deliver me letterbox .....

Is that the answer - that some DVD's were designed to ONLY deliver widescreen on the assumption that the full size screen is 4:3?

I'm definitely telling the DVD player that my TV is full size (16:9?).

Sigh.
Art