MaximRecoil said:
Yes, there is a reason, and it has already been pointed out. In short, the masters they used were essentially glorified 4:3 DVDs to begin with. To go from a 4:3 DVD source to a 16:9 DVD, you have to upscale the vertical resolution of the picture area. Upscaling the master when authoring a DVD isn't normally done by professionals unless they absolutely have to.

I have a question for you for whomever might know...

While I understand (now) that the LD master was letterboxed, presumably that master was made from some earlier scan. I'd also imagine that that scan was better resolution than letterboxed 4:3. Are we to presume that the scan from which that LD master was made no longer exists? Would it be customary for a studio to make an LD master from a scan, and then discard the scan?

An answer of "yes" would support your description that upscaling would be necessary to produce an anamorphic DVD. It would also surprise me, but I don't really know what constituted normal practices at that time.

An answer of "no" would support that this really was an intentional f-u to fans. Because it's hard to imagine that it would be so hard to generate a higher-res, standard anamorphic master if the scan was still available. I did essentially the same thing to make Puggo Grande and I was using a 1999 workstation.