Part of this is not understanding how a DVD works, so I'll try to clarify that part first: A DVD is made up of "legal" MPEG video files and "legal" audio files, plus some navigation info (menus, chapters, info how to respond to buttons on the DVD player remote). Subtitles are optional and can be used too, "legal" text files. When you author, all these video and audio files, plus nav info and subs, is put inside of tidy little VOB files of 1GB or less each. The IFO (InFOrmation files) tell the player what's in the VOBs.
When you go to extract the disc, you use the IFO files to read the VOB's, so you can take the video or audio back out again. Few programs can read IFO data, DVD Decrypter is one of them, You enter IFO mode, and it shows you the videos you have available. This was the process described in this guide:
http://www.digitalfaq.com/dvdguides/...corder/recorde redit.htm
Your DV footage is native DV. It cannot be inverse telecined (IVTC'd) because it was never telecined to begin with. Telecine is converting 24fps film to 29.97, and IVTC is convert is backwards AFTER the TC was done.
Native interlace must be deinterlaced, as IVTC will not work. At least not fully, leaves nasty oddities in the video.
As far as covering over the timecode, if a black box is what you want, that's possible, but takes some work. Personally, I'd just widescreen it with a matte. Before I go an describe this process in words, I'd like some pictures. Can you take a still image of the video and upload a sample image for me to look at? That'd make it easier than a ton of rhetoric.