Are you familiar with Walker Evans? In the latter part of his career he used to do tons of photography on Polaroid. I'm not sure if it was about convenience or effect (Evans had an idea that he could capture bits of time exactly as they were, so part of me thinks he wanted the immediate payoff of Polaroid), but many of his Polaroids have become museum pieces. This was in the days before a Polaroid could represent nostalgia, since Polaroids were new at the time, but they still took shitty quality photos. I think sometimes, in some instances, it really is the aesthetic, and not the nostalgia that drives poor res photography. I'm not saying that this is driving Instagram, but just that it can be a motivating factor sometimes.