Try: pixel aspect ratio should be 1.0, and on video event pan/crop make sure the options "Maintain aspect ratio" and "Resize to fill frame" are both set to Yes.
Btw, I'd highly recommend to not change the resolution; 1024x768 is very good, do not downsize it, that will not only lower the res but also make your video look blurry. Keep it 1024x768 and render at around 3.5M-4M bitrate.
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