Thanks for getting back to us with that information, kungas. It’s appreciated.
However, we need a bit of help to isolate the issue further.
First, we located these steps provided by Netflix when a video on their site isn’t playing as expected: Poor quality or distorted video
Also, see if playing a different video on Netflix and other sites are also showing blurry on your iMac.
How to use safe mode on your Mac - Apple Support -- If the steps from Netflix didn’t help, and other videos you play in Safari are also blurry, restart your Mac in safe mode and test. Play any of the videos you found blurry before to test the issue. Whether or not the issue is resolved or not, restart your Mac normally to exit safe mode.
Also, please be aware that starting in safe mode will take a bit longer than a normal restart. This paragraph explains why:
Safe mode prevents your Mac from loading certain software as it starts up, including login items, system extensions not required by macOS, and fonts not installed by macOS. It also does a basic check of your startup disk, similar to using First Aid in Disk Utility. And it deletes some system caches, including font caches and the kernel cache, which are automatically created again as needed.
If the videos played correctly while your iMac was in safe mode, see if it continues after a normal restart.
Please let us know the results when you're able.
All the best.
SnickZ.