It's not, notice how when your box is turned diagonally the edges are still perfectly straight, it were truly 64 x 64, a diagonal line would be jagged and pixelated, the base resolution of your project file should be 64 x 64 as opposed to scaling up smaller sprites to fit a larger resolution.
But, It is. All the sprites are also small, like the box is 5x5. I think the mule is 8x16. Godot has a setting for each image where you can turn off filtering of the images, otherwise it would've looked really blurry. Do not besmirch my low rez mule! ;)
Not sure if that is breaking a rule? If so, I guess it might be too late to change it now.