Is there any way I could fix or mitigate the blur on applications using XWayland caused by fractional scaling?

1 year and a half later the issue is still prevalent. Following your advice, I found a way to mitigate this by adding specific flags for the applications to run natively in Wayland:

However, by running natively in Wayland I faced with other issues related to the input of dead keys. I recently reported an issue to the vscode github page:

Have you found any solution to this issue in this time?