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The display is only half the issue. Unless you have a Blu-ray player and burner, you're still working with SD.
So should I just go with SD widescreen option?
>So should I just go with SD widescreen option?
That's what I do.
Unless you have a blu-ray burner and a blu-ray player, or if you encode to HD Windows Media and use a special DVD player that will play HD .wmv files, you can't display the HD material that you create in Premiere Pro. So the whole HD pipeline is wasted time and effort if you can't display the HD results.
>special DVD player that will play HD .wmv files
Mine also plays M2T files or MPG files of material captured directly from the HDV camera.
I haven't tried exporting to MPEG2 Blu-ray (which should work).
And can't you play a short HD video on a regular SD DVD on a PS3?