The preference will only affect media that's not yet in the project. So changing it after media comes in will not change that media. You'll need to delete that media and reimport with the check box off.
I could have sworn I unchecked that box before I even created this project but I guess I didn't. I do have a follow up question since we are on the subject. Will I lose any quality by stretching them back out? Even though the Motion tab says they are at 100% I know that they are not so I wouldn't think it would hurt anything to just pull them out to 160% (or whatever true 100% is).
Yes, if you scale down and then back up, you'll lose quality.
Ok, so I guess it works like applying a transform in Photoshop but without a confirmation dialogue box or an undo. Well that sucks but thanks for your help, Jim.