Typically the cursors are made to a specific size, and by using the size adjust feature you are essentially zooming in on the image.
Most cameras have 2 or more glass lenses that move closer or farther appart to zoom and focus on an item. This is called Optical Zoom. Typically optical Zoom is very clear.
Digital Zoom like on most newer cameras is the same basic thing as the zoom within CursorFX. It can only digitally enhance the image so much as it is enlarged to fill in the missing data, thus the image as it gets larger gets distorted. {just as it does with the newer cameras}.
In essence, it is a limitation of the image ( the smaller the image the less data there is to work with) and the Zoom capability of PC's currently. CursorFX Resize can only work within the scope of the above listed limitations.
There are a few larger cursors in the library you might want to try. Heres a couple right off the top of my head.
https://www.wincustomize.com/skins.aspx?skinid=2479&libid=25
https://www.wincustomize.com/skins.aspx?skinid=2374&libid=25
If you spot a Cursor you like You Might leave a comment in the comments section of that cursor asking for a possibly larger sized version. The WC folks are pretty good about a honoring a request when asked nicely 