I first heard about this in ATP. Marco said that the Retina screen is showing a scaled resolution. Then, Gruber’s MBP review pointed to this tweet. Now I am conflicted. Do I want to run the 13" M1 MBA at “Looks like 1280x800” and gets sharper text but less space? What about all of you? Does it bother you one bit?
I use the “Default for Display” option on all my devices (including with external monitors) and find the text just right. If I try any higher resolutions, I struggle to read it.
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I also use “Default for display”, because it just works and looks good.
The tweet I posted earlier claimed that “Default for Display” is not native!
It depends on which laptop you’re talking about. The original Retina MacBook Pros defaulted to true 2x (a 2880 by 1800 pixel panel scaled to look like 1440 x 900, or exactly 2x). Starting with the 2016 MacBook Pro, Apple started defaulting to a non-2x resolution (scaled to look like 1680 x 1050 in the 15" IIRC). The new 14" and 16" MacBook Pros have higher pixel densities and default to true 2x resolutions (3456 x 2234 scaled to look like 1728 x 1117 on the 16”).
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Somehow you made a clear, layman explanation, @ChrisUpchurch. In my case, which is the 13" MBA, the Retina is a 2560x1600. So, I have to choose a “Looks like 1280x800”, which is exactly 2x. This was what the tweet guy explained. The text is really crisps but, there is not enough real estate.
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Personally, I always run the display of my MacBooks in the highest scaled resolution and my 4K external monitors scaled to 1440p. On the notebook displays the (to me) tiny bit of loss of sharpness is more than made up for by the extra space, and on the external displays, scaling 4K to 1440p looks much better than the one native 1440p monitor that I have (at work).
This is all hugely subjective and I encourage you to play with different settings until you find ones that work for you. You may even find yourself changing them for different kinds of work 
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The nice thing about M1 is that changing display resolution is INSTANT! Hmm, a thought just occur to me: maybe there is a Keyboard Maestro shortcut to switch resolution on the fly!
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I switch through resolutions as I go through the day depending on what type of work I’m doing. For example, if I’m answering an email I tend to use a lower resolution and if I’m editing in ScreenFlow I typically use a higher resolution.
To make it convenient to switch resolutions, I use an excellent app called Displays by Jibapps. Among other things, Displays allows me to map keyboard shortcuts to frequently used resolutions. It works for both internal and external monitors.
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Talking of screen resolutions, does anyone have an answer to my perennial question about printers’ point sizes? For ages now I have been trying to find a screen resolution setting that lets me view, say, a 12 point font as being 12/72 = 1/6th inch high when the application zoom is 100%. I really don’t care how many pixels that is, or whether those pixels are actually clusters of 2 or more of each colour, I just want to see documents on screen at the same scale as printed.
That’s a great idea for me to consider… Thank you.
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I run at 1.5x which is 1920 on my older 15-inch. To my eyes, for some reason, 1.5x scaling looks crisper than other scaling (not counting native which is the crispest of course). I don’t have the brain power to figure out whether 1.5x requires less frequent pixel interpolation or what.