How can I fix aspect ratio/video cropping issues on my MacBook Air M2?

I recently purchased a M2 13 inch laptop.

And I need help with the following two problems:-

1- Every time I stream something on a OTT platform, the video gets cropped into this weird aspect ratio wherein the top and bottom 25% of the screen is a black bar, and I get to see the video in a very small window. Is there a way to fix this, or allow certain apps to use the Full screen whilst playing the video?

2- every time I am streaming something on Apple TV, there is a weird effect where there is constant fluctuation in the background with the light, where it is bright for one second and dims immediately after.

Any help will be highly appreciated!!

[Re-Titled by Moderator]