[Devon Brown] “…or should i take the 4:3 out of the project altogether?”
Try that first…it may work, although I doubt it.
Then try creating a new project in Encore 1.0.1 – import your 16:9 footage and see if a new project works correctly. There may be something in the old project that is keeping the undesired behavior.
If that doesn’t work, then you could try tweaking your 16:9 export settings in Premiere, although I also doubt this is the cause.
But if all of these fail, you really should consider upgrading. Four major versions of Encore have been released since Encore 1.0 came out over five years ago.