I've said it before and I'll say it again:
Copyright infringement is still copyright infringement whether it's for profit or not.
If you make a profit, then the companies are more likely to get annoyed, and you can be sued for more damages, but if you think it's all perfectly legal until you start making money, then you're just kidding yourself.
Note that the "private copying regime" in Canada, which applies to
music only, makes things a bit more complicated, and so does the concept of "fair use" in the US - but video is not covered by "private copying" and copying of entire works is not covered by "fair use". So-called "legal fansubs" are just as illegal as so-called "illegal fansubs"; there's an arguable moral difference, but no legal difference. Copyright infringement is still copyright infringement even when it's non-profit. Similarly, Phade's operation of this very server is illegal as heck. I wish him all the best and hope and expect that he won't get in trouble for it, but he's got bigger balls than I have, to do it openly under his real name.
Now, on the actual topic of this thread: You can't create information out of nothing. If you have a 4:3 video you can't convert it into 16:9 and get something that looks better, unless it actually was 16:9 letterboxed into 4:3 in the first place, in which case you can crop out the black bars. Similarly, if the audio is in WMV format you can't re-encode it at a higher bit rate and expect it to magically sound better - the information has been
destroyed by the compression process, that's why it's called "lossy" compression. At best you could remove the bad-sounding audio entirely and replace it with a fresh-ripped copy off the CD, but that's error-prone because you have to get exactly the same version the original creator used, which may be difficult on videos like my
Butterflies Never Laugh or
Mothyre, both of which have edits in the audio, or
Perfect Red where there are at least two different versions of the song (same band) in commercial release on different albums and everything will break if you get the wrong one - and, by the way, a lot of the music I use is fairly obscure.
You can't improve the video quality by re-encoding; if that were possible, software would do it automatically all the time. At best you can change the tradeoffs of one kind of artifact for another, without introducing too much additional suckage - but every re-encode costs you something somewhere. You can't get "remastered quality" without actually remastering the video, and that pretty much means getting the original video director to re-make the video with better source and more attention to quality. Changing aspect ratio is an artistic change and requires artistic participation; it's not just a minor format tweak.
The bit about re-mixing 2.0 audio to 5.1 was a joke, right?