If I watch an anamorphic 1.66:1 movie on my Grundig widescreen TV, the resulting picture uses the whole screen in its display. I would have thought that the picture should display somewhat like a 4:3 movie (i.e. the full height of the display but with slightly narrower vertical bars at the side).

I understand why 1.78:1 movies occupy the whole screen because 16:9 reduces to 1.78:1 but why does a 1.85:1 picture also occupy the whole screen? Shouldn't there be horizontal black bars above and below the picture just as there are in a 2.35:1 movie, only smaller?

Depends on your settings many TV's have an auto mode that formats any ratio to fit your TV.

What is aspect ratio?

The aspect ratio of a film is the ratio of width to height of a films image.

Example: 1.85:1 means the image is 1.85 times wider than it is high.

Common aspect ratios are as follows:
1.33:1 - Also known as 4:3. This is the size of a standard TV screen.

1.78:1 - Also known as 16x9. This is the size of HDTV screens.

1.85:1 - Commonly used for comedies and dramas and is very close to 1.78:1 so little or no formatting is done to fit widescreen TVs.

2.35:1 - Mostly used on action/adventure movies and the most common "wider" of the widescreen aspect ratios used.

http://www.dvdtalk.com/forum/showthr...eadid=165672#4

You may or may not see black bars on the sides of a movie with an AR of 1.66:1 because of overscan. Likewise you may or may not see black bars at the top and bottom of a movie with an AR of 1.85:1. On these ARs the bars are so small that the amount of overscan tends to hide the bars behind the edges of the TV screen. If you were to have an overscan amount of 0% you would see the bars but on most TV this just can't be done so an overscan amount of 4% to 5% is more common. Some TVs ship with an overscan amount of between 5% and 10% and actually crop image from the viewable area.