To: markac
In order to be able to apply effects and other changes to a video correctly in AVS Video Editor, the aspect of the video imported must be pre-determined, i.e. either 4:3 or 16:9 must be set. This is the principle according to which the program currently works. If the aspect was left as is during preview, after making changes when saving the movie certain distortions could have taken place.
As your AVI video has 720x480 resolution (3:2) and 4:3 is set in the program, mattes are added to it, otherwise the picture would be stretched vertically. The only way to get rid of the mattes in this case is to zoom the picture, but this way the right and left sides are cropped.
This is not a bug, rather a drawback. I will report it to our developers. They'll do their best to consider optimizing the program functionality in future.
Best regards