Graphical problems after 1.6.1 update

Initially I made an issue believing this to be a resolution problem which I think it is. It was resolved saying that you can change the resolution in launcher... I know this and it still doesn't affect anything. When ran in 1.5.2 it auto scales the resolution to the right point and my textures in game look good. When ran in 1.6.1, regardless of what I set the resolution too, it only affects the starter window and when I I press the square button at the top of the screen to put it all in view, the game seems to be re scale to a really bad resolution. You can't tell on screenshots for some reason, but in game it looks terrible.