Mmmmh ok, that reads well... Just like some advertising catalogue from microsoft: 4k, enhanced, amazing etc. If i read all this, it sounds like capturing is a catastrophe. Mind you, it was one of the four points plan you mentioned. All the stuff you bring in, doesnt change the fact, that you marginal will see any difference (i doubt if any). Maybe you come to that thought, seeing all the captures that are done already, with hacked, ancient equipment more than a decade ago and in a wrong way. Nuances in timing? possibly, but not visible to a human eye or hearable. Regarding all the other stuff, we can philosophize. If i see how the captures where made in the past and especially how wrong the VBI data was treated, i would also say, how amazing it would be, to do conversion instead. You self wrote "is theoretically perfect", but practically it will make near zero difference, but i admit you have advertized it perfectly. The MAME LDverify tool is/was only good to see, how the different LDP-systems treat VBI data, but practically its unprofessional, in that way that no normal person can send you proper capturings, for all the reasons i wrote already. Especially treating VBI-data (which is the most important stuff) like picture-content.
I am not writing all of this to debate with you, that conversion is the best, because i agree with you in that point. My concern is, the effort you need for that conversion method vs. proper capturing vs. the outcoming result. You may have preserved the LD better, until somebody come along and say "no, 40-bit conversion is the real thing". Which in theory would be true, but visibly its nothing. I hope you realize this at least. Regarding the arcade part of the LD stuff, i ask you if you have ever seen the footage? i guess not. There are so many threads where people say the same. Have you seen "Quarter Horse" for example? Thats crappy VHS footage on a LD medium and many games are done the same way. So you can come with proper antialiasing filtering that change picture, no distorted phase information and what not, it will still look like shit, even with the best conversion process.