Actually they didn't cut anything from what I read, but they did change from 3 67 minute OVAs to 2 OVAs.
So I looked around a bit...
Originally, we have:
Area 88 Act I Uragiri no Ōzora, 50 minute OVA released on February 5, 1985
Area 88 Act II Ōkami Tachi no Jōken, 57 minute OVA released on August 5, 1985
Area 88 Act III Moeru Shinkirō, 96 minute OVA released on August 15, 1986
But.
The first and second OVAs were edited into a 98 minute movie simply called "
Area 88" and released in theaters on July 20, 1985 (yes, shortly before the second OVA was released on video).
The OVAs were re-released on video in October and November 1992... except there were
four parts called "
Area 88 Act 1", "
Area 88 Act 2", "
Area 88 Act 3" and "
Area 88 Act 4".
Area 88 Act 3 (47 minutes) and
Area 88 Act 4 (50 minutes) actually were
Area 88 Act III Moeru Shinkirō, now divided into two parts.
The DVDs that are currently available in Japan are
Area 88 Gekijōban (i.e. the movie mentioned earlier, a compilation of the first and second OVAs), and
Area 88 Moeru Shinkirō (i.e. the third OVA, minus the "Act III" part of the title).
(then, there would be the 2004 TV series, but that's another matter altogether)