That's a weird resolution but since you start from a bigger resolution, it doesn't matter, you can set it to whatever you like(as long as it's even numbers).
The term 480p refers to the vertical resolution so since that's what you said, that's what I used.
That means exactly 480 pixels high and the width changes depending on the aspect ratio of the video. If it's 16:9, which it likely is, you do 480*16 and then divide by 9 which gives 853.333. If you do the same with 482, you get 856.88888 so using 858 makes it less accurate than what I suggested. The difference is still small enough that you won't notice though.
You got a strange effect with handbrake because it assumes things that doesn't apply to you with the settings you chose. Select the right settings and it'll be fine.
ffmpeg will also do a great job if you don't mind using the command line and gives you better control over things.
It's expected that option 1 and 3 don't give you a wide video because by default ffmpeg uses the aspect ratio you give it, which is calculated from the resolution you specify. You didn't set the resolution manually in handbrake like you did in ffmpeg so that's why it gave you a different result.
What you need to watch out for with x265/hevc is that it's very easy to blur details in the video so make sure to compare it to the original to make sure you didn't destroy a ton of detail. It might not be obvious just looking at it on its own but when compared, you might realize it doesn't look as good.
Instead of blurring things out, x264(the default for option 1 and 2) uses noise(random dots everywhere) to compress instead of blur so pick whichever you prefer/find acceptable for the file size you get.
Also, the slower the preset you use(except maybe placebo, which often just max things out and shouldn't be used as is), the smaller the file size will be for the same quality, but it takes longer to encode.
It's possible you have to specify the color space since HD and SD stuff is different so I don't know if ffmpeg is going to assume wrong things for it which might explain the color issue you had. No clue what you mean by activating icarus since I don't know what that is or what it does.