editing widescreen/aspect ratio(4:3to16:9)?

[kid apathetic]

here's the set up:
I have a dvd with two different hour-long clips on it. the first clip is 4:3 but appears to be squished. on the same dvd the other video is letterbox widescreen. it seems like both clips have essentially been made into one two hour clip(as opposed to separate titles). the dvd is authored with nice menus and chapter marks.

now what I want to do:
primarily I want to edit the first squished 4:3 clip to a widescreen(anamorphic?) format.
I want to retain the menus if possible as well as maybe the chapter marks.
If possible I'd like to edit the second clip(letterbox widescreen) to anamorphic widescreen so it matches with the first clip.

I'm concerned about quality loss, audio (off)synch. which software would be best for this job and about how hard would it be for someone that's not familiar with dvd authoring? I'd prefer anamorphic video as opposed to letterboxed. I really don't want to loose significant quality. Would using anamorphic as opposed to letterbox video take up more space? thanks in advance for your help.

[kid apathetic]

I hate to bump this, but it's been a couple of weeks and I'm still more or less clueless on the matter. retaining menus, while nice, is low priority as opposed to retaining the best video quality. thanks for your help.