I thought I'd give everyone an update. Once I see a problem like this and it becomes obvious that the user to user forums don't yield any results then I actually contact apple. So I did, about a week ago, if you just want apple's response go straight to bold letters:
It started as a chat, which turned into a support phone call the next day. None of them realized this was going on so when I told them they tried it on their devices and learned this was happening. After a few tech transfer to what I guess is a more experienced tech, they said they would reach out to "the engineers" and get back to me. The guy that told me said he thought it was simply apple dropping support for any size and that it doesn't happen to media purchased from itunes. He said he would tell them, but to not hold my breath. A few days later he called me back and said it's not what he thought. That apple is aware that it's a bug and that they'll release a fix as soon as they figure it out. When? nobody knows, but he assured that they push it out when they figure it out and fix it.
My suggestion is actually submitting feedback. These user to user forums are great if someone has a solution. In this case all our solutions are only fixing half the problem. Personally I've been using metax for windows for more than a year now and it works great, it retrieves the art itunes uses for movies and shows. It does not however pull screenshots or thumbnails. But I'll continue to use for now anyway.
Judging by the comments of the tech that submitted to the "engineers" it's possible apple knew they would no longer support all types of artwork sizes/shapes, but what they didn't realize is that the screenshots were not being generated for any media type anymore in any part of the videos app, including home videos. In fact, I'm inclined to believe that if the home videos were not having this problem they would have just said: too bad! but obviously this is all speculation. What's not speculation is that speaking up is not ignored, but we must speak up to them so that they are aware there is a dissatisfaction (camera roll being a perfect example).
That being said, I recommend everyone here who would like to see this fixed submit the feedback and let them know. It only takes a minute, and if nothing else, at least it lets them know that it isn't just some guy who chatted one night that has noticed the problem. You can submit the bug here:
https://www.apple.com/feedback/ipad.html. Or you can submit it in a different part if you don't think the ipad is right, but just submit it someplace. it would probably take less time to submit the feedback than to rant and rewrite every detail on how you're also "having the same problem", tell them. Here just can just write "+1" and we'll get it. It's all the same.
In the mean time you can either "create" fake screenshots for your home videos by taking a screenshot of it and adding it as artwork (metax does this) and make sure they screenshot is the right shape. You can determine this by looking at the shape of the square gray boxes. Otherwise if you'd like artwork for your movies and tv shows metaX also does this, automatically. There doesn't seem to be any solution at this time for the individual episode screenshots. For that, we'll just have to wait.
incidentally, I put a bug in the ear of the great mac app subler. Currently the app adds screenshots (on a separate track that it creates and adds into the mp4 container) for all the chapters in video. I mentioned the possibility of recreating this effect for episode screenshots, and not just for movie chapters. We'll see what happens. If he can also figure that out then perhaps we won't need to wait for apple to fix he problem.
Thanks for your attention, and thanks to everyone that has provided useful feedback, we now know the main issue which gives apple a target.
AR
