If it is letterboxing on the right and left rather than the top and bottom when you are watching a TV show (mostly 4:3), then that is NORMAL on a widescreen TV.
What are the aspect ratios of the movies you are trying to play (you can check this on IMDB.com)? If it is 2.35:1 then seeing the black bars on the top and bottom is NORMAL on both DVD and Blu-Ray because no widescreen TV can overcome this problem (2.35>16:9). Its just not physically possible unless you have a 2:35 TV, which don't exist.
If you are watching 16:9 movies (most non-action/non-drama movies, typically used for comedies, some dramas, and everything else) and you are seeing black bars, then you have a problem.
I use a full-screen HDTV (yeah, kind of an oxymoron) at my parent's house, and it will display the black bars on a 4:3 media file I am playing (I'm used to it by now, and I am getting my own widescreen soon), but it figures out 4:3 DVD's just fine. I haven't tried any 4:3 Blu-Rays.
We had two bags of grass, seventy-five pellets of mescaline, five sheets of high-powered blotter acid, a salt shaker half full of cocaine, a whole galaxy of multi-colored uppers, downers, screamers, laughers…Also a quart of tequila, a quart of rum, a case of beer, a pint of raw ether and two dozen amyls. The only thing that really worried me was the ether. There is nothing in the world more helpless and irresponsible and depraved than a man in the depths of an ether binge. –Raoul Duke
It is hard to shed anything but crocodile tears over White House speechwriter Patrick Buchanan's tragic analysis of the Nixon debacle. "It's like Sisyphus," he said. "We rolled the rock all the way up the mountain...and it rolled right back down on us...." Neither Sisyphus nor the commander of the Light Brigade nor Pat Buchanan had the time or any real inclination to question what they were doing...a martyr, to the bitter end, to a "flawed" cause and a narrow, atavistic concept of conservative politics that has done more damage to itself and the country in less than six years than its liberal enemies could have done in two or three decades. -Hunter S. Thompson