What does scaled resolution mean in OSX?
Solution 1:
As far as I understand it, "pixel doubling" was introduced in the 10.9.3 update for OSX Mavericks. If your graphics adapter supports the full 4K resolution, then using a scaled down resolution like 1080p will effectively cause pixel-doubling of the GUI. Basically, this works like the retina displays on MBPs and iPhones: the OS will use double-sized GUI elements and larger font size. The picture output will be native 4K (3840x2160), but the desktop GUI will look like 1080p (1920x1080). In this set-up your digital photographs (or videos) will not "lose" any resolution, because they will not be scaled like the GUI elements.
Solution 2:
Displays like LCDs, Plasmas, LEDs, etc have fixed resolutions. That fixed resolution is called its native resolution. Your 4K monitor has 4096 pixels across and 2160 down. So it's native resolution would be 4096x2160.
Display scaling (in this case) is the process of adapting a lower resolution into a higher resolution to match the display's native solution. Since the output is being changed, there will be a loss of quality. However, the more you scale, the more distorted the image/video will become. Whether you notice it or not, depends on a variety of factors. You can scale an image down, which also results in a loss of quality.
For the most part, scaling actually works very well. It only becomes an issue if you scale a very small output to a very large display, or if you scale resolutions of different aspect ratios.
In the end though, for the best quality you want to match your output to the native resolution. But, by no means is scaling a bad thing. You might never notice it.
There is no harm in trying the scaling. If you dont like the way it looks, you can always go back.