iDVD uses the 4:3 aspect ratio. Most digital cameras create images with this ratio. However, scanned photo can be a variety of ratios and will have to be cropped to the 4:3 ratio in iPhoto before sending on to iDVD.
You can use the photos in their original size if you'd like. That will cause the image to have black bars at the left and right and not fill the screen completely.
FWIW I find I get the best final image quality when I create the slideshow in iDVD from still photos in iPhoto. The downside to that is the Ken Burns effect is not available and you can have only one transition.
If you can crop the photos to the 4:3 ratio before using I think you'll have a better looking slideshow. If you use the KB effect don't over do it. Using it on every slide can be distracting making it difficult to concentrate on the actual content of the photo. (You probably can tell I'm not a big fan of KB. 🙂 )
If you do create the slideshow in iPhoto be aware that users have had problem with using multiple audio tracks in the export process. Many have found that each track seems to fade out way to soon leaving dead air between tracks. You can add multiple tracks in iDVD and that problem is not present.
When you're ready to burn the iDVD project first save it as a disk image (File->Save as Disk Image) and check it with DVD Player. This separates out the encoding process from the burn process. If it plays as you expect with DVD Player it's ready to burn. Burn to disc with Disk Utility at the slowest speed available to assure the best burn quality. Always use top quality media: Verbatium, Maxell or Taiyo Yuden DVD-R are the most recommended in these forums.
Don't hesitate to ask if you have more questions.