The DBP default setting is 640x480, and when you stretch this to fill say, a 1024x768 desktop, everything is blurred.
Set the screen to the desktop resolution or windowed mode with the window the same size as the DX surface and it will look fine.
Personally I think it was a big mistake of DBS, they should have made the default setting Windowed 640x480.
Download my plugin from the RGT website and do this
SET DISPLAY MODE GET DESKTOP WIDTH(),GET DESKTOP HEIGHT(),32
at the start of your program.
In addition, all images should be loaded with the ,1 flag to prevent blurring. There is a dithering issue which is fixed in P5 as well.