I have read it.
The video I am importing is:
Movie, 640 x 360 (1,0)
44100 Hz - Compressed - Stereo
And the sequence is:
Sequence, 1280 x 720 (1,0)
48000 Hz - Stereo.
So I went to change the Sequence dimension to 640 x 360 in Sequence Settings.
However in this menu the Video Frame Size is locked.
All I can change is the Video Previews width and height which does not solve the problem.
I also applied "Scale to Frame Size" on the video in the timeline.
But I keep having a black bar on top and bottom when exporting it.
Please, could someone tell me what to try?
Use the 'New sequence from clip' from the project panel when right clicking on the clip.
In your case the sequence and clip settings do not match, hence the black borders.
I'm not sure that's a bug, per se. It looks like the standard mismatch you get when scaling down HD footage and using the 'new' PAR values for SD.