Right, just got my camcorder JVC DVP7 - couldn't get hold of a Panasonic GX7 - but I'm more than happy with the JVC.
Anyway, the widescreen mode ("stretch" mode on the DVP7) does give you a 16:9 anamorphic picture so you use the proper widescreen setting on the TV. It actually doesn't look too bad on my 32" widescreen TV but it isn't as sharp or detailed as it is using the normal 4:3 recording mode.
However, it achieves this effect by cropping the top and bottom of the picture to create the correct aspect ratio and then "digitally adjusting" the picture to make it anamorphic.
So, in other words, you aren't getting a wider picture at all, you are losing the top and bottom part of the picture i.e. less information is used to make a bigger picture which is why it doesn't look as good as it does in the 4:3 mode.
In summary, it's an interesting feature and the results are not as bad as I had read they would be but for ultimate quality stick to 4:3.
Oh, and as for the DVP7 - I love it - so small but the quality is great and it seems to do everything you can think of.
Matt.