Punched-in footage exports blurry to lower resolutions

Hello everybody, unfortunately I need to open this topic back up after last time this issue was quickly (and wrongly) dismissed as user error and instantly moved to discussions. Since then I've been contacted by multiple users asking me if I ever resolved this issue, and I'm still experiencing this on day-to-day usage, here it is again with a test project for easier testing:

• Issue - When on exporting from any resolution to lower resolutions, punched-in footage only loses resolution. Resolution is fine while working in Premiere in the program window.
• Adobe Premiere Pro version number: 24.4.1 (Build 2)
• Operating system - Mac OS Sonoma 14.3.1
• System Info: CPU, GPU, RAM, HD:

  • CPU M1 Max

  • GPU M1 Max

  • RAM 32 GB

  • Internal SSD

• Video format: 3840x2160 ProRes footage
• Steps to reproduce:
  • Open a brand new project.
    
  • Import a 3840x2160 clip.
  • Drop it onto the "New Composition" button, a new clip with the same footage settings is created
  • Zoom clip into composition to 200% (basically a 1920x1080 crop remains framed, in the preview window it is still reasonably sharp).
  • Check that "Use maximum render quality" is checked everywhere, both on the comp setting and in render.
  • Try to export the clip: if exporting to 1920x1080, punched-in clips lose more resoltion than what you can see in the program window.
• Expected result - I would expect to at least retain all the available detail in the punched-in clips, which I can see just fine in the program window (meaning detail is actually there).
• Actual result - Clips come out blurry.

Test Project

I attach a test project that perfectly shows the issue. It contains a 2160p ProRes source clip, which for the sake of the test I scale up to 200% on the right side. On the left side I instead crop the 1080p central part of the clip and use "Scale to frame size". Both layers now show a 1080p crop of the source clip, but only one of them exports sharp when you select lower resolutions in the preview window. The lower the resolution, the more apparent the issue becomes.

Real world impact of this issue

I sometimes need to punch-in 2160p clip from clients project, just for zooming or reframing purposes. I still need to work 2160p timeline to retain all details for non-punched in clips. Clients also asks for lower resolution versions of exports (for example for easier storage and playback, but also for diverse application like exhibition led walls who only accept precise resolutions). All punched-in clips on those lower resolution files are completely ruined, and I have no indication of that happening without checking every single export (it looks fine in program window). No amount of fiddling with settings ("Use maximum render quality") fixes the issue.