Graphic quality set to high, yet player models are still EXTREMELY low

You clearly have anti-aliasing disabled. Go to your graphic settings and make sure it's set to TSAA. This game has TONS of jaggies without AA and looks horrible, it's especially visible on the character models from the distance. Basically, the further away you are from the detailed object, the more "clamped together" the pixels are, and jaggies become more visible.