If you know that raw PSEye video has picture from each camera split into four, you also should know that it is because PSEye utilizes the Bayer filter
http://en.wikipedia.org/wiki/Bayer_filter. So, the whole 640x480 picture is organized as 320x240 4-pixel units, each one being the Bayer pattern. For storing in AVI, we extract each component of the pattern into separate picture - and they all are 320x240, following the number of pattern units. During processing, interpolation algorithms are applied to restore full-color 640x480 picture.
With new iPiVideo format in v2, you will always be watching full-color pictures in iPi Recorder's Player.