Despite being real-time rendered 3D objects, character models are upscaled in the level-up screen if playing at resolutions higher than 1920x1080.
SAVED GAME: link
REPRO STEPS:
Load the attached saved game on a machine whose monitor runs natively at 2560x1440 or higher.
Observe that all characters have enough experience to level up.
Pick one of the characters and level them up.
Observe that when the level-up screen is brought up, the 3D model of the character is blurry as though it was being upscaled.
Being real-time rendered 3D objects, characters models should always be rendered at the resolution the game is set to, and never upscaled.