Rocketroo

I have uploaded textures before without any issues. However, this time I am seeing quite the resolution loss on the textures I am uploading. The textures are 1024 by 1024 resolution both on my computer and in world. The texture is a rose knit pattern that is clear on my computer and if i load in-world using 'local' as a temp it shows all the details no problem. However once I upload into world the resolution is lost. There is immediately noticeable loss of resolution. Image was uploaded "Use Lossless Compression" checked. I have tried uploading the image as both a PNG and as a TGA file. The main details become smeared as if the image was dropped to half resolution. This makes the texture totally unusable for build. Why is there such resolution loss and what can be done to fix this?