HD monitor with SD video screen format question.

I am currently editing with Final Cut 4.5 (upgrading to 6 very soon). I shoot with the Sony HVR-Z1U and use a M1U deck. I have a client that wants an HD raw tape for future use, wants to play a DVD master on an HD monitor, and is willing to accept this project in SD. I know how to downconvert from my deck into Final Cut, but I am wondering what format I should use to get the best image on the HD monitor - cropped or letterbox.