This is a much, much, much more detailed process than something that can be done On The Fly. For those thinking about it, you'll best be served by Learning how to use Gordian Knot's implementation of VirtualDubMod and AVISynth. Even still, you're upsizing a non-anamorphic picture to an anamorphic picture, so the computer is only making a best guess. However, the results can look pretty good. I used this technique on Hannibal and Harry Potter 3 in specific.

You'll need tons of drive space for the resulting AVI, which will then need to be re-compressed back to M2V. If you can frameserve, you'll be able to cut out the drive space need. I, however, always have messy results from frameserving. You'll probably need, what 200GB free for the AVI alone? Can anybody confirm that?

We still don't know if this will be progressive, interlaced, telecined or what. I'm hoping the material is at least 23.976 fps progressive, because IVTC'ing a 2 hour film will be a total mess.