With my dd, they never saw this on the ultrasound while I was pregnant, but in her first year she had like 5 UTIs. So awful because she's in pain and they have to use a catheter to get a urine sample to check for it every time. Poor girl is traumatized from those experiences. Anyway, they finally sent us to get testing done, which consisted of putting some dye up in with a catheter and doing an ultrasound to see if it backs up into the kidneys. I haven't heard the term "dilated" but they determined she does has reflux in her ureters so the urine goes back up into the kidneys which draws in bacteria, hence all the UTIs.
Since then, she has been on a low dose antibiotic to prevent more UTIs. She gets 5mL a day for an undetermined amount of time. The doctors said most kids grow out of it and their ureters mature and it doesn't cause any more issues. However there are times when they need to go in and correct. One option is they go up and place a small valve like thing in the way so urine can go down but it can't go back up. Another is much more invasive where they correct it surgically.
She'll go back for more tests in a few more months, just to see if any changes have taken place. If not, she'll continue on the daily antibiotics for another 6 months and recheck. I think after 2 years if there's still no improvement, that's when we'll consider the other options.
Anyway, just wanted to explain that it's really not a horrible issue, so try not to worry too much. If your baby has something similiar to my dd, worst case they have surgery to fix it. My daughter was a preemie, born at 30 weeks so I am thankful that this is her only health problem.