The DVX100 can't do anamorphic. What it does in the Letterbox mode is give you letterbox on a 4:3 aspect ratio. In order to do anamorphic with the 100, you really have to use an anamorphic lens. Can you do an upconversion in post? Yes you can, but that's pretty pricey and the quality won't be as good as using an anamorphic lens.
Upconverting to anamorphic from letterbox isn't pricey, it's free. Most every NLE should be able to stretch the footage. Whether the quality is satisfactory is a matter of personal taste -- I find the results in Vegas to be pretty good, the results in Premiere 6.0 were decidedly unacceptable.
Did I say that? Hmm... if I did, I don't recall... it depends on the algorithm used. Under normal circumstances I think squeeze would have a slight advantage over post-stretching, since post-stretching invariably will cause an uncompress/recompress cycle.
I think what I said was that squeeze mode could not be superior to letterbox mode, because both start with the same image, and squeeze mode then gets... well, squeezed. Someone had said that squeeze was superior to letterbox, but it can't be (leaving letterbox as letterbox, that is). If you go and stretch the letterbox image, then I'd expect squeeze could deliver a slightly better image (or actually a much better image, depending on how good your stretching algorithm is).
Then, the anamorphic adapter can handily trump both modes, but only if used correctly. If you don't take the time to extract the best quality from the anamorphic adapter, you could end up with images no better than squeeze mode, and it's certainly easier to shoot with squeeze mode. If you take the time to set up your shot properly, and adjust your lighting to bring your f-stop into the right range for the anamorphic, then the anamorphic can deliver quite superior results.
From seeing resolution charts, etc., it looks like Squeeze mode is comparable to, if not slightly higher quality than, stretched letterbox. But comparing squeeze to letterbox is what we were discussing... and that would imply in the same camera. From what I've seen, squeeze is at least comparable to, and likely slightly superior to, post-stretched letterbox.