The settings are:
tv standard: PAL
video card: generic
If you have it set for 640x480 you're going to get 4:3.
You need to use a supported video card.... since the video card is going to dictate the output to the TV, you need a video card that can output in a format your TV supports (specifically, I mean cabling!) and in order to see widescreen you then need to use video settings that support that (720p for instance).
Sorry, but on my computer, with a nice 19" or 17" LCD Monitor, those support 4:3 format and if I watch widescreen? I get the black bars across the top and bottom. Unless I'm willing to "zoom" in to lose the black bars, and then lose video on the left and right in order to fill my screen. Not much I can do about that, that's the way the monitors work.
In your case it's pretty well backwards, you have a CRT widescreen TV but your settings are 640x480. That's what you're going to get!
You didn't say which video card you're using... tell us.
Most likely the solution is to use a different video card. Between the wiki and these forums you should have no problems finding models that are supported.
On the other hand, if you don't need the TV tuner or home automation features, you may want to look at XBMC. It's a nice looking, easy to use, easy to install media player.... but you'll have similar widescreen vs 4:3 issues no matter what you use at this point in time.