Did you switch the TV to zoom mode? You're doing something wrong, mine works fine. You also have to realize that not every movie is shot in 16:9 so with many movies you will still see a bit of black but it shouldn't be a big deal because it will look much better anyway.
What TV did you buy? I researched mine for 3 months and found an awesome one. I'm getting a 37" for my bedroom soon and the one I'm looking at is great.
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