Lowpoly is totally cool, but is there a particular reason you have (or need) such blurry and small/stretched/compressed textures?
If you're trying to fit a particular texture size limit I'd recommend just going all the way and making your textures custom pixel art, similar to how Kenneth Fejer (http://www.kennethfejer.com/lowpoly.html) and some other lowpoly modelers do it. That way you can keep your textures limited to tiny sizes but also have them still be readable and crisp rather than looking like vague blurry... shapes.
If you're actually trying to replicate the blurriness on purpose that's one thing, but... some things really should stay in the past ahahaha
Not to mention that some games did actually use pixelart textures (Megaman Legends, among others) but hey, your models, your choice.
The over-blurred textures are based off the fact that N64 games used a-lot of AA to make their textures look "smoother", but instead just made them look weird.
I like to make models in my free time. I also make weird games, too.
Tried to do some pixel-made textures, but KHed screwed it up and over-AA'ed them. I cannot loop textures on a triangle, either, so I'd have to make another poly if I wanted to loop the texture, which I'm not going to do for low-poly authenticity.
I like to make models in my free time. I also make weird games, too.