Alpha basically refers to transparent effects/textures (if you are familiar with photoshop at all, the alpha channel controls the opacity of an image, it's the same thing with textures/effects). Rendering transparencies is bandwidth intensive and so resolving them at low resolution is a compromise done to save on bandwidth. This was a common theme with PS3 games vs 360 games for example because of that console's limited memory bandwidth compared to the 360. Anyways, when you are resolving transparencies at low resolution, and you have a scene where there is a transparent texture/effect covering most of the screen like in that image, it will look like dogshit.