Makes you wonder why the need for the incredible detail if we are just fine with blurry details.

We are "just fine" with blurry details, on some level... but a lot of processing a movie holistically comes from that level of detail being present. Even if few people walking out of the theater could put their finger on why the world felt vibrant, it'll come down to the fact those details were there.

So much of movie making is like that. No normal person comes out of a theater saying "wow, the color grading on that movie really helped the drive the main themes along, I particularly appreciated the way it was used to amplify the alienation the main character felt at being betrayed by his life-long friend, and the lighting in that scene really sent that point home". That's all film nerd stuff. But it's the lighting, the color grading, the camera shots, all this subtle stuff that the casual consumer will never cite as their reason for liking or disliking the movie that results in the feelings that were experienced.

They aren't necessary. People still connect with the original Snow White, and while it may have been an absolute technical breakthrough masterstroke for the time, by modern standards it is simple. But used well the details we can muster for a modern production can still go into the general tone of the film; compare the two next to each other while looking for this effect and you may be able to "feel" what I'm talking about.

We were fine watching movies on VHS tapes and small CRT TVs, but watching a high-quality encoding on a 4k TV is much better.