Simply explained: It costs less to render the viewport at 256x256 and then after everything’s been rendered simply taking that 256x256 final image and scaling it up to 1024x1024 - Especially useful on Mobile.
This doesn’t work for Pixel Art, though. Or really anything without losing image quality. The reason why this works with Pixel Art is because Nearest Neighbor scaling doesn’t ruin the image. Bilinear scaling makes it blurry. Yes, you can scale every texture up manually but that’s not the point - the point is to save performance. You’re effectively running the game at a much lower resolution and that’s VERY good.