First of all, thank you so much for taking the time and effort to write such a detailed and thought out response! Much appreciated!
So, for this game, I made the sprites at (basically random) larger sizes in GIMP and then scaled the image down to 64x64 or whatever to then be imported to GM2. So basically if I had "nearest neighbor" selected before scaling down in GIMP the blurriness/etc. would not have appeared?
Following your example, how did you decide on a resolution of 480x270? And how did you know to draw the sprites at 36x24? In my head, I would think that to apply the 16:9 aspect ratio to a 36x24 sprite would mean you want a resolution of 576x216 for the game (as that is the result of 16*36 and 9*24), but I must be missing some key part (more likely parts) of this. I'm also confused by game resolution vs. viewport vs game window, are those terms interchangable? Sorry for all the questions, I am very new to this stuff.
I will be checking out both of the links you sent me, thank you again.
No worries, if you don't get a chance to answer all those questions, you have already set me down the right path :)