There is no question about the heritage of 8bit-style art, and whether you find modern renditions ugly or not is not really a concern here. But I would like to point out as someone who grew up in the eighties, people referred to those little atomic picture cells rendered on the display as "
pixels", not as "
my monitor's representation of a pixel".
It's also worth mentioning that for most of us today, graphics tastes have changed quite a lot, so emulating the original blur and smear of an NTSC display is perceived as far less of a generally acceptable aesthetic solution than rendering rectangular blocks is. Of course, opinions differ, but you can totally vote with your wallet on that.
You're talking about how art is designed with an expectation about the manner in which it is later consumed. To the degree this is even a realistic expectation, you would have to make the same concession to today's pixel artists who are creating works loosely based on an 8bit heritage, but which are often clearly and intentionally distanced from that heritage. You might personally object to viewing original games from the 8bit era on modern systems at all on the grounds of authenticity and distortion of artistic intent, but that's not an objection you can raise against modern pixel artists and their working premises.
Overall, I object to this notion that, say, the average 80s CRT pixel representation is somehow the canonical rendering of the ur-pixel and that we should strive to somehow emulate that. I think we should instead do whatever works for the modern context. You might counter that blocks don't meet this goal for your tastes, or that we should stop using recognizably blocky pixels altogether, but again that's a personal preference.
The actual argument above was not about personal preference at all, it was about what can rightfully be referred to as a pixel and what can't (and I do maintain that in this context linguistic pedantry does not yield any meaningful benefits).