I experience the same problems since November 2020. MacOS sucks at HiDPI integration and scaling for external displays. In windows 10 or Linux my 24” QHD displays are razor sharp! This is 8 year old hardware and the new QHD monitors look amazing.. on Mac Mini M1 it just sucks.. blurry/fuzzy. I get headaches from it..
I sincerely hope apple will fix this mess with external displays. There is no reason not to enable. HiDPI on QHD monitors, it is not 2005 anymore and the GPU’s are more than capable without any performance hit.
I also tried the 4K Edid emulator solution as discussed on macrumors; this unfortunately is not. A full solution