First reading the reviews for this product, I chose the VHS version believing the transfer would be better and the VHS would contain scenes not available in the DVD version. The VHS arrived without audio, so I returned it and decided to purchase the DVD-- even though reviewers said the DVD version was edited and transferred unsatisfactorily.
When the DVD came, I was most pleased with the transfer. The picture is very clean and crisp and the audio portion is so superior that I am able to hear dialogue clearly which I had missed previously. Missing scenes? No. In fact, there are some small scenes in the DVD version which I had not seen before in the other versions I have viewed (for example, the dining room table scene with Ceddie and the Earl of Dorincourt).
All this aside, I love this movie for its portrayal of the redeeming power of love. My children benefit from watching it because Lord Fauntleroy is a powerful example of courage, respect and virtue. I have often wondered what it would be like to have a child without sin (only Jesus qualifies), but "Ceddie" as Little Lord Fauntleroy is perhaps the closest approximation to come from earthly minds. His mother, also, is a woman of admirable strength, wisdom and grace. Most inspiring.
I have no reservations recommending this film in DVD format.