Interesting, I didn’t know that scaling factors of < 1 were a thing, as most settings UIs only let you go as low as 1.0. But I just tried this on Ubuntu 24.04 and the result was as expected, so maybe this was an issue in the 22.04 that got fixed by now?
What I did get, however, were blurry fonts when using fractional scaling instead of just changing the font scale factor. This is apparently a long-standing issue that gnome 47 has finally fixed (I’ve tried the current Gnome OS live ISO and everything works correctly there).