Yes, it does switch the resolution...in one direction.. That's why it no longer spans the screen. The issue is that's ALL they changed so the end result is that the screen is optically narrower, exactly like if you had a anamorphic lens on sideways. Every pixel is the same size and shape as it was before and in the same place as it was before reletive to other sprites. The difference is they changed the width resolution to a higher res thereby squishing the screen vertically so your ship is moving faster side to side (reletive to actual screen dimension) than it does up and down.
More correctly, the resolution of the game stays the same, only the output of the PCE itself changes, and in one direction only.
f*ck it. I can't explain it to people in terms people understand and I'm too lazy to make a f*cking video for people who can't read.
Ok, one last chance...you know how your grandma watches the news in wide mode even though the analog cable she's getting is 4:3 so all the circles are ovals and everyone is fat? "Arcade mode" is exactly the same as that except instead of streatching it wide, your smooshing it thin. The other difference of course is that your grandma is almost blind and doesn't give a shit and PCE fans are sitting on thousands of dollars worth of games and systems and Framemeisters and shit so you'd think they'd know better.