Re-editing SD DVD to create HD movie for broadcast

HI,
I have a friend that wants me to take their older SD edited documentary and re-edit it to create an HD video with 'closed captioning' as required by the local public television station. Plus create a different but similar project with those same requirements (HD and closed captioned from SD sources).

For the Re-edit, I have the original Final Cut timeline
(from a different editor but the client saved to their own hard drive):

I figured I could re-create the non-video tape graphics
in HD then somehow box the documentary footage in SD in the HD video output.

e.g. if there are any photos or slide shows, recreate them into HD photos and slide shows to take up the full screen 1080,
and then when the SD footage shows it'll be in a widow or some design in its original size so there's not too much pixelation.

I was wondering if anyone has done this yet and what successful work flow they used.

I have 2 projects like this:
one is a finished DVD in SD as noted above,
the other is a start from scratch but with old VHS tape footage, and SD mini cam footage (NTSC).

Besides the closed captioning which I just downloaded a paper from Ken's list on that topic (An Intro to Closed Captioning)
any other pointers or pitfalls to avoid would be helpful.

One important specific question I have off the bat is the capturing.
I've always captured native (what ever the source, I use that capture setting).
but for the purpose of eventually using an HD 1080 output/final QT movie,
should I capture to some other setting that is either an HD setting or an inbetween?
(no even sure if this is a possibility, just searching for some good logic here)...


thanks,

el profe

Final output from DV media will always look like DV, or worse if you render to other export.

Cheers
Alexander