(C) Your SCART cable doesn't have the WSS signal pins connected so the information is not getting through to the TV.
Unlikely, but have you tried a different SCART cable?
I'm thinking it's likely "B" - the TV is old so while not necessarily 'stupid' may have needed the 4:3 signal direct from the BT Vision box, which I presume did the letterboxing itself for 16:9 programmes (most had them when displayed) and just sent that?
Oh well. It is what it is
If there is no way to fix things with your current TV then the only other zero cost alternative I can think of would be for BT to swap the BT Youview+ box for a black BT Vision+ box running the New Look software.
The New Look software on the black BT Vision+ boxes does still have a 4:3 output option which if I remember correctly sends letterboxed 16:9 pictures in a 4:3 frame over both SCART and HDMI. It's probably not as flexible as the Classic software which used to have other crop/zoom options available through the shorcuts button. I think your 4:3 TV would probably always be showing a black bar at the top and bottom as I think everything is letterboxed whether you like it or not (ok for films, not so good for some other programmes). Can't remember if it's a full 16:9 letterbox or a 14:9 crop+letterbox compromise that some TV's and boxes can do.
It's a long while since I've had my black BT Vision+ box connected to a TV via SCART as I normally use HDMI with an HD TV. So I normally have no reason to select the 4:3 output option.
This is of course all assuming that there is no way to output in 4:3 from the BT Youview+ box. I haven't got one so I'm not in a position to check myself.
I doubt they'd swap. This "special offer" all appeared to be done to offload a load of first gen YouView boxes and no longer have to support the old servers. At least, I doubt it would be free. Might as well just save up for a TV as our current one is bound to die sometime anyway
Also, have no problem with letterboxing on programmes. Would rather have the widescreen picture without distortion, than have the whole screen filled but losing a lot of the content.
I have searched every setting and I can't find a way to change the ratio aspect on my youview box but I have screen aspect on my TV remote which can change it ok on the TV but need to watch through TV rather than through the youview box.
There is no way of altering the aspect ratio on the Youview box away from what the programme maker and the broadcaster intended (even when the broadcaster occasionally gets it wrong).