It could be that the only solution to actually help you is a screenshot of the scene with "squished" aircraft.
Changing the resolution affects the whole picture, so it should affect all objects in FSX then.

Running the native resolution is the way to go though and should lead to a normal appearing sim.
The only downside with a widescreen setup are some 2D panels which weren't developed for that aspect ratio, but all 3D objects should be fine since they get adjusted to your screen then.

Are you running in windowed mode or fullscreen?
Windowed with a maximized window always forces the sim resolution to fit to that window, so you will get a picture fitting to the native resolution of your screen if Windows itself is running at 1680x1050.
Fullscreen mode is a different beast, you can force any other resolution there and the interpolation of your screen does the rest, sometimes leading to strange looking things.