you can upres in any NLE or After Effects/shake
digitize the footage
then make an HD project and import the footage and then adjust its scale to fit the HD project. It won't improve the quality of the footage. There is a plugin called "instant HD" that has some tools to better upres footage. google it
it won't help with color subsampling of the footage since it was compressed to get it on the minidv tape so there is no undoing that.
I understand what you're saying and I have use InstantHD and that works very well for doing an uprez.
I'm curious because I've transferred footage from DV to Digibeta and that really helped the sub sampling immensely as it seemed to resolve the blockiness, so I'm really just interested as to whether you can take a DV tape clip and transfer it to DVCPRO-HD in camera on the HVX.
To get rid of the blockiness for keying in Shake, you can add a node to convert to YUV, then blur the luminance (UV only - so apply to the G and B channels) at 10x10 pixels to soften it, and then add a third node to convert back to RGB.