The widescreen is B5's original aspect ratio. Straczynski had it framed for widescreen because he figured that HDTVs would be A Thing in the not terribly distant future.
The CGI wasn't rendered in that high of a resolution because they were using Amigas, and they figured it would be easier to re-render the CGI in whatever higher resolution became the standard down the line. No one expected the master files to be lost.
Nope, not the case. Everyone knew widescreen was just around the corner, and it was producer John Copeland who convinced WB to let them film it wide.
As for the CGI. As Copeland explained, there was never a plan to re-render for widescreen –it’s just a much repeated myth. It was rendered in 4:3 - not because of hardware limitations - but due to a penny pinching short sighted decision (which saved 75 bucks an episode).
Even though jms has said for years that it wasn't possible – after reading the following he admitted that he’d foolishly believed what he was told by Netter at the time, and would have paid for it himself if he knew about it.