LFL wanted to test the waters of DVD just like Disney did at first. Many labels weren’t as willing to just jump in at the forefront and release a number of crappy early discs that were little more than LD ports. They also wanted to maximize profits and figure out the DVD market. Thus you had to wait until 2001 to get the DVD SE of TPM and could only get a VHS copy in the US for almost three years. I’m surprised they didn’t let it come out on LD but the format was pretty much cut off here before TPM would have debuted. Looking at lddb specs the last US Fox LD was Entrapment in late November 1999. The Japanese TPM from Fox came out in January 2000 so it just barely missed a USA LD release.
The first major DVDs readily available to consumers from studios at entry price points weren’t really hitting until 1997 particularly the first waves of Warner snapper case titles.

They were wanting to do more work on the OT and that eventually became making the new masters, handing them to Lowry crap digital and then over-processing the life out of them and making the new changes in mixes. This likely took some time after beating around the bush for so long and is why they finally came out in Sept. 2004. The peak of the DVD booms was really around 2005 so they timed it perfectly. And of course not telling anyone it was another version suckered us all into buying it and getting home to start the hours of horror…

I’m sure Fox would have been more than happy to have gotten the 97 SE out on DVD perhaps with a slightly spiffed up master of the LD versions from the later Japanese releases say around 2002. That would have given us a much better source to work from and a higher quality official 97SE release but nooooooo…it can’t ever be easy.