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OKAY THERE. the first dithering manually applied: the dark blue shadow under the legs is now a 50/50 blue-black checkerboard. Looks fine to me!
although it looks very similar to this one. huh, is that an earlier version of this?
and you really need to zoom in to tell the difference.
Basically what happens is that it's running the 3D renderer at half-height, and stretching it out to the full height. So it has to render half the pixels.