Question: I can't seem to think of the word for this, but images in the iPhone simulator appear as though they were of a far lower resolution than they are. At 50% view, the simulator is already larger than the screen, but it is seen even worse at zoom level 25% and, strangely, it appears better in the 100% view, but still pixelated.

The high resolution image should zoom out accurately, but appears lower quality than the source image. It appears fine on the device and when viewing the source images.

25%[![enter image description here](https://i.stack.imgur.com/MVUdz.png)](https://i.stack.imgur.com/MVUdz.png)

50%

[![enter image description here](https://i.stack.imgur.com/Yc703.png)](https://i.stack.imgur.com/Yc703.png)

100%

[![100%](https://i.stack.imgur.com/1VXsw.png)](https://i.stack.imgur.com/1VXsw.png)

Source Images:

At 1x:

[![enter image description here](https://i.stack.imgur.com/6Koil.png)](https://i.stack.imgur.com/6Koil.png)

[At 3x](https://i.stack.imgur.com/Lr2CB.png)

Answer: 
The issue was solved by going to Debug menu -> Graphics Quality Override -> High Quality and then restarting the simulator.

On 50% it looks fine now. It did not fix the 25% zoom issue, but I don't use that mode anyway.
The reason why the 50% and 25% images look bad is because you're missing a lot of pixels. The simulator is always run at 100% and if you scale it they will just show every other pixel of every other row, or every fourth pixel of every fourth row. That's 75% or 94% of pixels just thrown away. 

You can easily see this effect by scaling an image with nearest neighbor algorithm. 

The reason why the 100% image looks jagged on simulator and not on device is because of the pixel sizes. If you take a magnifying lens and look at the phone, it will look as "bad", you just don't see it due to the size. Since you have to scale to 25% to get the full simulator to fit, you clearly don't have a huge resolution in screen, which means big pixels. 

You shouldn't use overly big images anyway, since it will just consume memory and may produce unwanted artifacts.

Here is an example of your image resized to 50x50 pixels using nearest neighbor:
[![enter image description here](https://i.stack.imgur.com/8arsW.png)](https://i.stack.imgur.com/8arsW.png) and you can clearly see that it is totally jagged.