When people played it at Capcom events, E3 and TGS, and loved the visuals, it was displayed on widescreen sets with the picture zoomed in to fit the screen.
This is probably the best answer. To most people, it just doesn't make a difference... in fact, for that 90+% it probably turns out a bit better because the development team didn't have to make things work well for the other 10%. Not that it makes their choice a Good Thing, but still.
And really, if you want some true higher-definition widescreen RE4 goodness, we all know it almost CAN'T not happen some time in the next 5 years.
:lol If only that was true for Europe too. I'm still waiting for HDTVs here in Sweden (except for the couple of expensive as hell LCD TVs they're selling with HDTV support).