My camcorder produces MOD files in the above format. Loading into Kdenlive project set to DV Widescreen special shows a squashed sideways picture with black bars either side in the monitor and renders to a file similarly. Is there a way to remedy this as it makes the use of Kdenlive a no go as it stands.

In the Advanced tab of the Clip Properties, try setting the aspect ratio to 1.45 or 1.46.

Is it widescreen?

Not sure if you are aware but 704x576 is a standard DVD resolution. It is 16 pixels horizontally smaller than 720x576 also a standard DVD resolution. However you loose 8 pixels each side of 720x576 when it is played back, your camera is just being frugle.

If you try scaling it to 720 then the aspect ratio will be wrong. Scaling to 720 will reduce the quality only to have another 8 pixels each side removed on playback.

If there isn't a 704x576 project then can you do a 720x576 black track and position your video files central horizontally over it on a second track giving you very thin vertical black bars each side, on playback you shouldn't see them.