I use DSR quite frequently so hopefully I can help. So if your using a 1080P monitor and using 2K DSR the system will render the game at 2K (2560x1440P) then it scales back to your native res and by doing so makes the game look a bit better however because the system is running the game at 2K it's a much heavier utilization on the system then at 1080P so your FPS will be lower.
For example my native monitor is 1080P but in some games I use DSR at 4K so the game normally will run at 150 FPS at 1080P but when rendered at 4K it dips down to 60 FPS since its rendering a higher resolution.
As far as the DSR smoothness (sharp vs blur) 33% is the default by Nvidia. I've tried higher and lower values but TBH it doesn't look as good as the...