It's a design flaw (or artistic choice or whatever) even in 4:3.
I see it as an artistic choice in 4:3 that was handled improperly in the transition to widescreen.
If it was anamorphic it would lose the black bars on the top and bottom in 16:9 and TH resolutions, which they did not want.
Your widescreen non-anamorphic DVD example just proves you are not factoring in the idea that they intentionally chose the format they used. See how the corners are faded to black? In the video there is also black that takes over the screen, like the character is blinking, from time to time.
It was an artistic choice, not a misformat. It was designed to be a 4:3 video so it could look like a small circle of vision in a black fog, and it scales and displays properly in all aspect ratios.
There really is no widescreen related flaw here, and nothing you have said proves otherwise.