This drove me nuts for days and I mention it here in case it helps someone else. If you import a portrait/square/non-standard aspect ratio image into a 16x9 movie then MSP12 just imports it as you would expect and you get 'black bars' at the sides. Import a 4x3 image though and it will get stretched to fill the whole 16x9. For no reason. I finally discovered that a 4x3 image has its pixel aspect ratio changed to 1.3333 on import, and changing this back to 1 fixes the issue. There's obviously a setting somewhere that thinks it's clever recognising 4x3 and stretching it to 16x9, but really, that's not clever.
There's a project setting called 'Adjust source media to better match project or render settings' but this seems to have no effect.
If you're importing a bunch of images for a slideshow and many of them are 4x3 landscape, you have to change every one of them back to 1:1 pixel aspect ratio before you can go to work. Seems like a major bug. I raised it with Sony support but they seem to have taken a vow of silence.
If anyone knows the secret setting, I'm all ears!!