Vector displacement makes your textures uncompressed.
As for your blue guy it looks like the source art does not have a correct antialiased alpha channel, or you material is rendered as Masked.
Filtering can also cause blurriness if you are wanting sharp pixelated look. You can change the filtering type on the texture from default, to Nearest. This is under the textures Properties under Texture/Filter.
You can look at Tappy Chicken for examples of this if you want.
You can adjust what res the games runs at natively on a per device basis. Newer device will need to be set to 2 to run at native resolution.
look under you game/Config for DefaultDeviceProfiles.ini
if you don’t have this file, you can create it, and add this inside.
[IOS DeviceProfile]
+CVars=r.Streaming.PoolSize=160
+CVars=r.Streaming.UseFixedPoolSize=1
+CVars=p.EnableAsyncScene=0
+CVars=r.Scalability.MaxTextureQualityForLowVirtualMemory=3
+CVars=r.MaxAnisotropy=1
[IOS DeviceProfile]
+CVars=r.MobileContentScaleFactor=1
[iPhone4 DeviceProfile]
+CVars=r.MobileContentScaleFactor=2
[iPhone4s DeviceProfile]
+CVars=r.MobileContentScaleFactor=2
[iPhone5 DeviceProfile]
+CVars=r.MobileContentScaleFactor=2
[iPhone5s DeviceProfile]
+CVars=r.MobileContentScaleFactor=2
[iPad2 DeviceProfile]
+CVars=r.MobileContentScaleFactor=1
[iPad3 DeviceProfile]
+CVars=r.MobileContentScaleFactor=1
[iPad4 DeviceProfile]
+CVars=r.MobileContentScaleFactor=2
[iPadMini DeviceProfile]
+CVars=r.MobileContentScaleFactor=1
[IPodTouch4 DeviceProfile]
+CVars=r.MobileContentScaleFactor=1
[iPodTouch5 DeviceProfile]
+CVars=r.MobileContentScaleFactor=1
[Android DeviceProfile]
+CVars=r.Streaming.PoolSize=160
+CVars=r.Streaming.UseFixedPoolSize=1
+CVars=p.EnableAsyncScene=0
+CVars=r.Scalability.MaxTextureQualityForLowVirtualMemory=3
+CVars=r.MaxAnisotropy=1
[Android_Low DeviceProfile]
+CVars=r.MobileContentScaleFactor=0.5
[Android_Mid DeviceProfile]
+CVars=r.MobileContentScaleFactor=1.0
[Android_High DeviceProfile]
+CVars=r.MobileContentScaleFactor=1.5
[Android_Adreno320 DeviceProfile]
BaseProfileName=Android_High
[Android_Adreno330 DeviceProfile]
BaseProfileName=Android_High