I personally do not know the technical aspects, but I do believe Guzz is correct based on my observations. When I look at my screenshots way back from 2009 through 2021, there is not really a difference except in graphical settings and resolution. Most of the past computers I had has a NVidia GPU. All of my past and present screenshots showcases color banding/pixelation/dithering/artifacts. My first computer having an incompatible integrated Intel video card.
Looking at my screenshots I tend to also notice the higher the resolution, the more color banding/pixelation/dithering/artifacts is made more prominent. But to me, clearly something that has always been as also RobbyC mentioned. In addition, also setting the NVidia Control Panel anisotropic filtering to 2x or 4x or 8x or 16x will of course bring way more clarity to TS3 and again make those unwanted visuals stand out even more.
To confirm, I currently have a NVidia RTX 2070, Win 10, 8-Bit color depth monitor at native resolution of 2560 x 1440 @ 144 refresh rate. Right now I am not up-to-date because doing so resets TS3 options in which I have to reapply my custom settings, but soon because I'm guessing RE8 will get updated on the Geforce Experience, etc so I'll just wait until then like I did with Cyberpunk 2077. Anyway, updating should not affect TS3 because I too believe these visuals were already there since day 1 made worse, in my opinion and observation, with higher resolutions/Control Panel settings. Possibly even HQ mods as well or any sort of image sharpening.
Personally, I do not care about the visual shortcomings as The Sims 3 is still among one of my favorite video games of all time. It may not be the most beautiful compared to the modern games I'm used to that put graphics and gameplay high up on the list, but nonetheless an oldie and goodie for sure.
However, you know, if anyone out there is into a brand new realistic life simulator that is like a combination of all the best features of TS2 and TS3 but so much more ambitious and geared toward a mature audience with high-end hardware in mind for full potential, no holding back...I would love that. Of course, I will not hold my breath though. I am quite happy and content with what I deem is the best and most advanced life simulator, TS3.