Why the image is blurry on 4K display if I set 1920*1080 resolution?

This problem has a long history. You may see an NVIDIA feature request dating from the year 2012 at Nonblurry Upscaling at Integer Ratios, still today without any answer or solution.

In short: The video adapter uses a more sophisticated algorithm than simple pixel multiplication (two pixels for one), which works well for many tasks but not very good for this too-simple task.

Most advice you will find for the problem would be to replace the display adapter and/or monitor, which is not very practical.

One person has claimed success in this task. I quote below part of his advice (with small modifications):

You have to convince Windows that your display supports HD as a native resolution. This can easily be done by using CRU (Custom Resolution Utility) authored by ToastyX and can be found here:

https://www.monitortests.com/forum/Thread-Custom-Resolution-Utility-CRU

It was as simple as adding 1920x1080, rebooting, and selecting that resolution. I added it to detailed and standard resolutions and all is well in that department.

I have not tried this solution and so cannot vouch that it works.

I know this post is old, but I spent hours on this issue today, and finally find a solution that worked for me, so I wanted to share. For me, the solution was to go in the NVIDIA Control Panel, select the blurry screen, use NVIDIA Color settings and select : "Output color depth: 10 bpc" (the default was 8).

I has been a life changer, my screen is sharp again.