Do not change the aspect ratio or any of the other normal DV-NTSC settings if you want to stay in the DV codec.
Go into the Sequence settings for your sequence (not the overall Sequence Settings, which affect new sequences). In the Video Processing tab, change the setting for Motion Filtering Quality to “Best”. You will need to re-render. This should improve the quality of any resizing or other effects in the Motion tab.
If they still are unsatisfactory for you, you will need to use a different codec.
Create a sequence using the preset for 8 bit Uncompressed or Pro Res. Copy and paste the contents of your current sequence into the new one. You will need to render the entire sequence. This will eliminate the degradation caused by the DV codec. Export a Quicktime and encode. This produce better quality results. It will not produce better results if going back to DV tape however, as everything will be re-encoded to the DV codec and return to looking like mush.