The blurred version feels honest -- it's not showing you anything more than what has been encoded.
The sharp image feels confusing -- it's showing you a ton of detail that is totally wrong. "Detail" that wasn't in the original, but is just artifacts.
Why would you prefer distracting artifacts over a blurred version?
The details are quite real, and they make the image far more comprehensible.
Get a picture of grass, save it as a JPEG at 15% quality... It still looks like grass. Then run it through jpeg2png... The output looks like a green smear. You might not even be able to tell that it's supposed to be grass. jpeg2png just blurs the hell out of images.
You're not seeing the actual details either way.
The blurred version feels honest -- it's not showing you anything more than what has been encoded.
The sharp image feels confusing -- it's showing you a ton of detail that is totally wrong. "Detail" that wasn't in the original, but is just artifacts.
Why would you prefer distracting artifacts over a blurred version?