It is further complicated in that my first release will be a DVD5, with anamorphic flag set. So it has to be vertically squeezed just enough so that when the anamorphic flag stretches it will turn out correct.

When you say "see the curves", do you mean see the original curves, or crop them with curved borders? The reason I find the exposed curves a bit distracting, is that the created border is hard, whereas the curves in the film corners are fuzzy. The combination of hard and fuzzy borders is a bit distracting. Also, one jiggles and one doesn't.