Lots of issues to address. Firstly, I have rewatched the Restoring Bambi featurette and yes,
apparently they put a "dull layer" (your description) when the computer is processing the scan. But – only on the first two examples. On the third example (Bambi in the forest with flower) the exact opposite happens. So bang goes that theory, even if what we're seeing is correct, which I very much doubt.
Have you seen the state of the condition of the "scan" they use for these examples? I
very much doubt that that is the quality of the archived negative. So I believe just like Disney's before and after restoration demos on their sneak peeks/trailers, Disney are somewhat bending the truth with that comparison, and the whole "layer" issue is not reality.
But let's assume
it is the truth. Just for arguments' sake. (Of course, if it is Disney being somewhat lax with the truth, then your whole argument has no basis, so I guess you do want to assume it’s the truth.)
Do you really think you could get a DVD with quality as good as Bambi's without a computer being used on a source
that bad?
How the heck do you expect a negative in that condition to be "restored to its former brilliance" via just photochemical means? I would say it would be more or less impossible. Also trying to physically clean the negative would run a huge risk of permanently damaging it. Making a copy of the negative would only result in the imperfections being "burnt into" the new copy. The only way they could get something approaching "clean" would be to work of a copy of a copy made earlier when the negative/original print was in better condition (in fact, I would imagine several generations of copies being as the film is 70 years old).
But I repeat: I doubt the original negative was ever allowed to get in such a state as seen in that "Restoring Bambi" featurette, and the whole featurette is therefore questionable. It's not as if it was kept in somebody's attic for 70 years is it?
But if it was, the computerised method
has to be the way to go. But even then, trying to "fix" that frame by frame would still be a huge task. So yes, some automated processing is done. It has to be done – notice that manual processing is also stated as being done.
Look at this Pinocchio frame you're so keen to use as an example:
There's plenty of "noise" in the image (and white is too – see Gepetto's eyes and hair highlight;the fact it has a highlight shows it was never intended to be white) – so it would appear that what you are complaining about is not visible on the latest Pinocchio restoration.
I would say Pinocchio uses the latest technology, but the same is also true of Bambi's restoration – the very restoration you are using as an example of doing wrong:
Again, "noise", brush strokes and white in the eyes.
People can only do the best with the tools that they have available at the time. What I feel is important about these digital restorations is that:
[a] I would assume every stage of the process is being digitally archived. That means I would assume the original scan before any dust/speck removal or colour adjustments is archived somewhere – ready to be used again when techniques improve. For how cheap computer storage is these days, it just doesn't make sense to throw any stage of the process away. So there's always a possibility of a "better" restoration in the future.
As Disney has shown with Sleeping Beauty and Pinocchio, they're not adverse to spending the money on new restorations, making [a] likely in the future.
I personally feel these latest restorations – each and every one of them, including Cinderella – is vastly superior to what could have been achieved with older, film only based restorations. I also feel that the people doing the restorations put a lot of time, effort and love into them too. I've never argued they're "Perfect" - I've always argued they're the best we're going to get at this time.
Having got my Bambi DVD set out, I actually viewed a segment of the film, and something that struck me immediately was how poorly bits of it was encoded. I've never really noticed before, but since I've gone High-Def stuff like macro blocking is much more noticeable. Marky, if I remember correctly you have in the past stated that there's no point in Blu-ray. Yet here, repeatedly, and on repeated threads, you examine and nit-pick even the smallest of things on the SD picture. A little illogical, no? Considering Blu-ray has 6 times the definition of the SD picture and can use much more efficient encoding, resulting in less compromised images.
The softness you mention is most likely the result of downscaling a higher resolution picture to a lower resolution picture - try it on photoshop. I did with various colours on various backgrounds (and each JPEG I made is saved with a quality of 100%). As KubrickFan mentioned, the old DVDs may of had contrast/colour modifications to make the lines stand out more to deal with the reduction and potential MPEG-2 encoding issues. .
See:

You really shouldn't be taking any DVD as the quality threshold, compare
DVD Normal Size http://www.jamesreader.plus.com/ud/ac7c8610-2.png
DVD Upscaled http://www.jamesreader.plus.com/ud/ac7c8610.png
Blu-ray http://www.jamesreader.plus.com/ud/74dcad8c.png Can you see any "softness" on this?
Blu-ray Trailer http://www.jamesreader.plus.com/ud/9e7bcc78.png
Admittedly, the second DVD capture has been blown-up to HD proportions (I scaled it down for the Normal Size image), but look at the MPEG-2 artifacts in the encoding, which are nothing to do with the restoration. As I understand it Xylon gets his screen captures from his HDMI lead on his player (the same way Blu-ray.com get theirs) so it is literally what will be going to your TV screen.