The pixels appear quite blurry in sprite manager 2

I'm working with Sprite Manager 2 and I wanted to use its pixel perfect ability to make a simple 2d terrain map. I tried using a PSD file and a PNG file and when I enable pixel perfect it seemed to be somewhat blurry, instead of crisp and edgy.

Does it require that I make the size of the texture a multiple of 32 or something? I tried changing the orthographic size and a few other things as well. I must have missed something when I watched the tutorial video or something I'm assuming.

Its just not as sharp as the image I have in photoshop.

Image dimensions: 1024x1024

I also tried switching shaders as well. I'm going to try using other file formats as well.

My goal is for it to look sharp not blurry.

I found out what was wrong. I was looking at the actual size of the file after it was converted. In photo shop it was 3000 x 3000 and I had the maximum resolution set to 1024 X 1024 so it resized it causing it to lose its quality.