I'm confused, I used Xsane for years with a USB MFP scanner. No problems! A bit dated and confusing multi window UI, but okay. Now for some reason I get PNG images with artifacts on this new printer/scanner and searching the Internet gives me no clear directions what to do.
Although you selected PNG as a lossless format to save the scan, there is an advanced option —Menu: Show advanced options (Ctrl+6)—where you can set the compression used for transmission from the scanner to the client from JPEG to None. You should see better results on higher resolutions now, I did.
I looked at LP:192176 and spend to much time trying to understand what the different parties where talking about when the bug was apparently solved, but users are still experiencing this behavior by default.
Therefore I'm putting this answer here and hope people don't have to waste anymore time trying to edit files, updating packages, reading walls of text or else.
Edit 2022-04-02: New problems, not sure if they are related to running Wayland. https://unix.stackexchange.com/questions/679321/resize-xsane-tiny-window-in-gnome Also, raising this in simple-scan: https://gitlab.gnome.org/GNOME/simple-scan/-/issues/294