I think the "G8 and Foxy" was a ploy to allow them to release 4:3 DVDs of Foxy. They most certainly did not have to do that, and they really don't have a history of merging arcs in the DVDs. So, I think it was a cover to let them. >__> Evil!
Anyway, yes, if nothing better is available when we get to 261, which is most likely, I would like to use the HDTV rips. I don't know if that's the final decision, but it seems highly probable.
Toei really doesn't seem to have a lot on the ball as far as their HD releases go. Not including the screwed up Foxy releases, they also used the same ED14 for 24 episodes, the longest an ending has lasted since ED1 and ED2. Also, the Luffy eyecatch was the only one they used for a very long time– that was very annoying. Their DVDs also have a history of poor mastering.
Are there any chances of a double release?
(DVD and Widescreen)