As for video quality, the Nexus 7 uses the whole screen while the iPad Air has black bars on top and bottom taking up space....now that's lame.
You're refering to letterboxing, The nexus has an aspect ratio of 8:5 landscape, iPad, 4:3.
TV shows are typically produced in either 16:9 or 4:3. & Movies ~1.85:1.
In order to preserve the filmmaker's intent, letter boxing (those black bars), otherwise, the film would be distorted to fill the screen, either by lopping off the left & right edges of the frame, or streching the whole thing vertically.