I don’t really see the point of such a mode for N64. The blur feature was created exactly to reduce sharpness on the horizontal axis (as you said a sort of anti-aliasing feature). This is best captured with generic 4:3 (which, btw, does not do any interpolation, it just samples at a high enough sample rate to adequately capture the continuous nature of an analog scanline).
If you were to do optimized sampling for the 640 width, the result would look extremely weird as you’d have repeated “sharp” pixels followed by repeated “blurred” pixels. I can only imagine this will result in some horrible looking vertical banding.