Worked for a couple of years now doing trip DVDs for Doc Anes' shark diving expeditions and a couple of other dive operators. When I switched over to HDV last year, my onboard workflow was to acquire the footage in HDV, then author SD DVDs for sale to the clients. I use a Z1U for topside and the A1U for underwater. To produce SD DVDs in time to have them packaged and ready for sale before we returned to port, I'd downconvert the footage via iLink Conversion during the capture process. (I also like the results of iLink downconversions more than the software based ones I've tried.) I use my camcorders to capture, and try to spread the work evenly between the two camcorders to even out wear and tear. (Would love to use a Firestore for topside, but haven't acquired one yet....)
My SD work has been in 16:9 for several years now, so widescreen is something I'm used to working in. I downconvert the HDV to SD 16:9, then edit and author the DVDs using my powerbook, FCP and DVD Studio Pro. The DVDs are all authored so that they are in 16:9 but will letterbox when a standard monitor is detected (usually, except in older players).
Then, when I get home and want to produce an HDV short for whatever purpose (film fest, tradeshow, internet), I make copies of all the clips in my bins that I want to use, rename them with HDV in the clip names so I can tell them apart, take them off line, and batch capture the lot in HDV. Because I've already set the in and out points for the initial capture (on board the boat) it's a very easy process to make a copy of all the clips in the bin, take them off line and recapture as HDV. (I just need to remember to make sure in the initial logging process that I've named the reel so I use the correct tape when I'm recapturing!)
I know that workflows are very personal, and everyone has their favorite. This is mine when I'm producing trip DVDs where the state-of-the-art for HD DVDs and the related client demand has yet to really develop. Once that does, though, my guess is that I'll capture and edit in HDV, and downconvert in the MPEG-2 encoding process for folks who still want SD DVDs.