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This needs to be done in hardware, before the signal is digitized. Most errors become embedded and permanent one converted to digital.
This whole forum is dedicated to that topic: http://forum.videohelp.com/restoration-f43.html
Also a lot of information at http://www.digitalfaq.com/forum/forumdisplay.php/dvd-project-help-9.html and http://www.digitalfaq.com/guides/video/index-restore.htm