Is 16:9 Format Quality the same in iMovie and FCP

The camera appears to have a 4x3 CCD, therefore, if you shoot 16x9 footage you will be losing about 25% of the vertical resolution of the CCD (ideally 720x360 but your CCD resolution may be lower). If you shot this as "anamorphic" the camera will internally process the information from the chip and stretch it to be recorded on the 720x480 DV frame. If you shot letterbox, then you will have the black bars filling in the 25% you never captured in the first place. Did you lose resolution shooting 16x9? Well yes, but there really isn't anything you can do about that other than a) shoot with a true 16x9 native CCD camera or b) use an anamorphic lens adaptor if it is available for that specific camera. Those both have other issues to deal with.

As for quality going into and out of iMovie or FCP. DV is going in and DV is going out so they should be close to if not exactly the same as long as you have the settings correct. Make sure that iMovie is set to 16x9 widescreen only if you are definitely sure you shot anamorphic footage (not letterbox). The only difference I could imagine between iMovie and FCP is in the rendering of effects and transitions, but I haven't done any tests to prove that a difference even exists. I'd say you should probably decide whether you need the tools, power and versatility that FCP offers vs. the simplicity of iMovie as I think the question of quality is moot at this point. Hope that helps.

I used to work with DSR250 a lot, and I can confirm that 16:9 mode is not as good as 4:3, because of the 4:3 CCD chips as mentioned above.

But yes, if you make sure iMovie is working in a 16:9 project before capturing, you should be able to burn a DVD without letterboxing.

FCP also works with anamorphic material certainly, but there is no real advantage in this case over iMovie. In fact, you would have to use DVD Studio Pro because FCP does not "flag" the video as anamorphic for iDVD like iMovie does.

When you opened iMovie did you......

Create a new project and select "DV Widescreen" from the popup?

The default is just DV. This drove me batty for months until I figured it out. If you use the default DV option it assumes 4:3 and would therefore letterbox all your 16:9 stuff.

If you haven't bought your camera yet, I'd check out the reviews section on http://www.camcorderinfo.com, they do pretty thorough testing on 16:9 vs. 4:3 modes on each camera... giving you a "real world" resolution for both modes.
Just and FYI. The pages load really slowly in Safari ( don't know if it still does ), so If you spend a long time there comparing models, I would use Firefox.

imovie and fcp and compressor all use quicktime as the backend for converting exporting movies, so yes an imovie exported under samesettings would look as good as on in FCP or compressor. The difference is that in FCP/compressor you have infinite times more control.