On your ATV open Settings > Video and Audio and set Tap-to-Zoom Videos to ON. When you are watching something that is letterboxed double tap (don't press) the scroll pad on the remote. This may not work in every app.
EDIT: I did a quick test and this does not work in Netflix and Disney+. So, zooming the video like that probably only works when you are watching through the TV app.
On your ATV open Settings > Video and Audio and set Tap-to-Zoom Videos to ON. When you are watching something that is letterboxed double tap (don't press) the scroll pad on the remote. This may not work in every app.
EDIT: I did a quick test and this does not work in Netflix and Disney+. So, zooming the video like that probably only works when you are watching through the TV app.
Apple has created so much confusion here. In fact, what you are talking about is the "TV App" and AppleTV+ is one of several "tabs" within the TV App. Since there's an icon of an Apple, it's natural to assume it is called the "Apple TV App". But it isn't! They really should have come up with a better naming scheme for all these apps, services and devices.