the more RGB pixels within a given area, the greater the possible varitety of colors in that area.
That doesn't sound right. Whether you have 1 or 1,000,000 pixels in any given area, the range of colors possible is defined by the bit depth. It may well be that you can only create a very small square with just 1 pixel, but the possible color values of that square would be the same for the much larger 1,000,000 pixel square, assuming both had the same bit depth.
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