Letter boxing issue

Hi, I'm noticing a discrepancy between my 720 x 480 source footage and my sequence footage (see properties below) . When viewed full screen, or in the viewer, the 16x9 source footage fills the screen (or the viewer window) but once in the sequence, it's being letterboxed, so it fits into the canvas, and when played fullscreen, the letterboxing carries over, so that the image doesn't fill the screen, but is framed in black. The letter boxing carries over in quicktimes and onto DVD. Is there a way to make this footage display as true 16x9 as it does in the source? When I select anamorphic in the sequence settings, or otherwise try to change them, it seems only to stretch and distort the image.
Source footage properties:
23.98 fps
720 x 480
Compressor: DV/DVCPRO - NTSC
Data Rate: 2.7 MB/sec
Pixel Aspect: NTSC - CCIR 601
Anamorphic
Sequence Settings:
23.98 fps
720x480
Aspect Ratio: NTSC DV (3:2)
Pixel Aspect Ratio: NTSC - CCIR 601 / DV (720 x 480)
Anamorphic: (unchecked)
Compressor: DV/DVCPRO - NTSC
Thanks!

matthew6 wrote:
When I select anamorphic in the sequence settings, or otherwise try to change them, it seems only to stretch and distort the image.
You're on the right track, after you change your sequence setting to be anamorphic, drop a new clip into the timeline and it should look fine. Copy that clip, highlight all the letterboxed clips and Paste Attributes, select only Motion and Distortion. Any modifications you made to Motion will be lost (sorry)

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