I guess my eyes aren’t good enough to see it. The slider image looks ok to me. I even zoomed the browser to 150% and it still looks ok. I’m only using a 23″ monitor so maybe that has something to do with it. In any case, if you know you’re slider is always going to be that size, you could do one of two things:
1. Reset the default theme thumbnail-large size, then regenerate your thumbnails. That would create a new thumbnail of 1060×500 but it might actually be as blurred as what you see now. The other downside is, wherever “thumbnail-large” is used in the theme, that size thumbnail would be used although it would probably be scaled down.
2. You could register a new thumbnail size and call it, say, my-big-thumbnail, then upload images that were larger than that size to create new thumbnails, then edit the php file that displays the slider to use “my-big-thumbnail”.
A bit of work no matter how you look at it. Might even get to the point where this theme is not the best fit for what you’re trying to accomplish.