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It specifically says - "Custom resolutions, up to 4096x4096, Anti Aliasing and Texture filtering".

First of all, isn't increasing the resolution just gonna make the games look all pixelated since they were originally 480p or is there some settings I am supposed to enable? Also how do I turn on AA and TF mentioned above? I am seeing options here but I am not sure what to tweak

Increasing the resolution removes the pixelation because you're rendering more pixels.

Texture Filtering is on that page you posted a screenshot of, the antialiasing is under the "Configure Hacks" section, but you need to tick "Enable HW Hacks" first.

Also I recommend you change the Renderer to at least Direct3D11 (Hardware)

Changed it as you suggested, any other options I should change in general?

Oh yeah and I am not seeing AA here

That all depends on your hardware and if you're having issues with framerates

Oh I see, also why are there two options for resolution? One is called internal resolution and has native, native x2, x3 and so forth and there is this one

That one in the screenshot isn't resolution, read it again

As for custom res and the native x2 etc, the native x# options scale it linearly to the original resolution, so if the game runs at 640x448, Native x2 will run it at 1280x896, where with a custom resolution you can force it to always be a specific resolution, but we recommend you use the native scaling as it reduces glitches.

Oh window size is not the same as resolution? Will since I have a 1080p monitor I would want native x2-3 for it to look like it was made for it, I see!

Yeah windows size is the size of the window on the screen

Yeah you can easily see the Window Size change as you change the size of the window itself lol