Google ads can sometimes look pixelated even when they use high-resolution images. The quality of images can be affected by Google's scaling and compression techniques. The blurriness of the ads could be caused by several factors:
Image quality issues: Google Ads has strict requirements for image quality, and low-resolution or fuzzy images will not be accepted. Both the image's layout and its quality must meet Google Ads requirements. The image cannot be grainy.
Scaling issues: When you scale down high-resolution images to fit the small ad sizes required by Google Ads, the images can become blurry due to the loss of detail. This is a common problem when designing ads for low-resolution outdoor displays.
Font/text issues: logos or text-heavy images often get disapproved for being blurry, especially when the text is small. Google prefers ads with clean, crisp text.
See the below links for more information about Google image sizes and quality requirements:
https://support.google.com/google-ads/editor/answer/57755?hl=en