You are watching an anamorphic picture intended for display only on a widescreen TV. You need to go into the player’s setup menu and tell it you have a standard 4:3 TV, not a widescreen 16:9 TV. It will then automatically letterbox the picture so you can see the full width at the proper proportions.
In some cases you can change the aspect ratio as the disc is playing (by pressing the “aspect” button on the remote control). On most players you have to stop the disc before you can change aspect. Some discs are labeled with widescreen on one side and standard on the other. In order to watch the fullscreen version you must flip the disc over.
Apparently most players that convert from NTSC to PAL or vice-versa can’t simultaneously letterbox (or pan and scan) an anamorphic picture. Solutions are to use a widescreen TV, a multistandard TV, or an external converter. Or get a better player.