I have selected widescreen project and to capture in widescreen etc... but all caps become 4:3

Then you have to click on the Pan/Crop icon on the clip and then right-click on the "F" and select "Match Output Aspect."

Evidently what has happening is the footage you shot was "squeezed" onto the 4:3 frame (anamorphic). Now Vegas has to "unsqueeze" it.

Jay

This is wrong!
Vegas will not "squeeze" anything during capture. The source of confusion is that 4:3 and 16:9 DV are exactly the same, after all you can shoot perfectly legit 16:9 by putting an adaptor on the front of the camera. Neither Vegas or the camera is going to be any the wiser!
You sure will be when you look at it in the viewfinder and you will be in Vegas until you tell Vegas how to display it.
Jay's got it half right, set the project properties to 16:9, which doesn't actually do much, and then right click the preview monitor window and select Simulate Device Aspect. The only place the project property setting will make a difference is with generated media and some FXs. You could pretty much edit 16:9 on a system that knew nothing about 16:9.
The one and only difference between 4:3 and 16:9 that anything apart from the viewer can know about is a flag, I think in line 21, that tells the displaying device what aspect ratio to display the footage in. More device ignore it than respect it from what I've seen.

I stand corrected!

However, I did not say that Vegas squeezed anything. I said--ment to say-- the camera squeezed the image. Vegas can and does unsqueeze a squeezed image.

Jay

Jay,
I know this sounds like nit picking but I think it's important to precisely understand the process. Vegas doesn't unsqueeze 16:9 footage. That implies that it's changed the footage, it hasn't. What it can do is display it unsqueezed. I know that might sound like a trivial distinction but unless you get the difference clearly in your head all sorts of misconceptions start to creep in.

Bob.

Thanks for the replies dudes... but i forgott to ask something... When i select 16:9 in the project and 16:9 i the capturing preview, it dipslays it in 16:9 format. And even when i have captured it and edits it in vegas the view is still 16:9. So.. if i put the file i have captured on the storyboard it displays in 16:9, But, if i open the same file with zoomplayer instead of vegas, it displays 4:3 "squeesed". Sure i can make AR to widescreen in zoomplayer, but i will get black borders then. And when i open the file with my xbox, it is 4:3 squeesed, and when i check settings on the file it is 4:3. The point is that i get that format with any capturing program. As you said farss, seems like its no differense between 4:3 and 16:9 DV, but still i dont really understand why.

Well, try looking at it this way. TV was invented long before the digital age. The concept of pixels didn't exist. So when digital video came along a way was found to stores the frames of video as pixels. Simple so far.
But to keep thing economic there was no need to take a simple digital snapshot of what was on the screen, if you get what I mean. Even standard DV doesn't use square pixels, most graphics programs do. So even with 4:3 footage so you can see it correctlt Vgeas or any NLE has to remap the pixels in the frame to a different set of pixels for display.
Now with 16:9 the same thing is done, accross one horizontal line there's still the same number of pixels being recorded, 720. How those pixels should be displayed is the thing. You can even record cinemascope into DV, just need to tell the displaying device how to remap or strecth the pixels.
Same thing is done with film, all 35mm film has the same size frame, but by using anamorphic lenses more image area can be squashed into the frame. Film is edited and processed just the same. When it comes to be projected differenent lenses are used to stretch the image to the correct aspect ratio and fill the matching area of the screen.
So when you capturing DV you're always capturing 720x576 or 720x480 pixels, depending on whether its PAL or NSTC, that's it, no other choice! The only option occurs during display, mostly you have to tell the displaying device effectively what the aspect ratio is, just the same as the projectionist has to have the right lens in the projector.
The only aid the displaying device gets is a flag in the video to tell it id its 4:3 or 16:9 but as I said a lot of devices plain ignore it. Now if its a native 4:3 device, it may understand 16:9 but to fit that onto the screen it has to have black bars top and bottom. Comversly if it's a 16:9 device being fed 4:3 there'll be black bars at the sides. Only other way the device can cope is to crop bits off.

Thank u soo much for the help man, now things are much clearer :D Thanks again