First let me provide system info:

• Using Encore CS3, Premiere Pro CS3, After Effects CS3
• Windows 7 Home Premium 64bit
• Intel i7 CPU, 16GB ram
• LG WH10 Blu-ray burner
• Verbatim BD-RE 2x media

Hee's my problem.  I have a blu-ray project (1440x1080, 29.97, h.264) that has two timelines and one menu.  The audio and video were created and rendered in Premiere.  After importing into Encore, the video and audio files reflect "Don't Transcode". For the menu, I selected the NTSC Radiant WIde Menu template.  I burned the project and it worked perfectly.  I decided to add video and audio to the menu creating a motion menu.  In Premiere, I created a 15 second video that's 720x480 1.2 PAR using the MPEG2 DVD, NTSC Widescreen preset.  The background video imported into Encore without problem.  I rendered the motion menu and previewed in Encore and evrything worked perfectly.  I burned the project to disc without problem.  Here's the problem:  The background video for the motion menu is now 4:3 instead of 16:9 and the button highlights are misaligned.

I've been troubleshooting for 5 hours now.  I've been able to confirm the following:

1. The background video, when added to a timeline, burns and plays fine as a 16x9 video
2. I created a new project, added the assets, created the menus again, the problem still persist.
3. I've played the disc on multiple devices including computer and PS3 and the problem persist.
4. To be sure it wasn't a problem with the source file for the video, I created a new video using the Black Video presets in Premiere and had the same problem
5. I used the Encore NTSC Data Higway wide template and had the same problem with the video included in the template
6. I used the Encore Crib Menu HD template with the video included in the template and had the same problem
7. I used the Interpret Footage function in Encore to ensure the video is recognized as 1.2PAR, still the same problem.

The only problem I've been able to identify is odd.  If I use the interpret footage function in Encore, it says that the source file is 1.0 PAR.  I've confirmed in Premiere and After Effects that the video is indeed 1.2 PAR?

I am completely stumped..I need help!  Thanks in advance..