Switch 2's new "Handheld Mode Boost" can run original Switch games at 1080p
The Nintendo Switch 2's backward-compatibility with Switch games is generally pretty good, and a few games have gotten patches from their developers to allow them to take advantage of the higher resolutions the console supports, among other features.
For unpatched Switch games running on the Switch 2 while it's docked, there should generally be no loss of quality compared to playing the same game on the Switch—the game will run at 1080p on both consoles and should generally run about the same as long as there aren't other compatibility problems. But games running on the Switch 2 in handheld mode can actually look worse than they do on the original Switch, mainly because they'll still run at the original Switch's native 720p resolution, which then has to be stretched out to fit the Switch 2's 1080p display.
A new Switch 2 system update released yesterday (as reported by NintendoLife) has introduced a partial solution for this specific problem. Version 22.0.0 of the Switch's software includes an optional feature called "Handheld Mode Boost," which can be enabled by opening the console's settings, then System settings, and scrolling down to "Nintendo Switch Software Handling." This setting will attempt to run original Switch games using the same settings they would use while docked, even while the console is in handheld mode—this usually means a step up to the Switch 2's native 1080p resolution, along with other graphical upgrades.