For older devices, save your 57x57 icon as Icon.png. For the iPhone 4, save your 114x114 icon as Icon@2x.png. The image resolution doesn't matter at all; only the pixel dimensions matter.

There are other sizes to cater to, like Spotlight/Settings icons and iPad icons. There's a full list written up in the library documentation.

As the iOS device range got a whole lot more complicated in recent years, here is a current list of icons and their requirements for each platform:

iOS 7+

iPhone and iPod touch

Both of these sizes are required:

120px x 120px60px x 60px (standard resolution)

iPad

Both of these sizes are required:

152px x 152px76px x 76px (standard resolution)

App Store

Create a large version of your app icon in two sizes so that it looks good on all devices:

1024px x 1024px512px x 512px (standard resolution)//Be sure to name this version of your app icon iTunesArtwork@2x and iTunesArtwork, respectively.

Spotlight search results on iPhone, iPod touch, and iPad (recommended)

Create an icon in the following two sizes:

80px x 80px40px x 40px (standard resolution)

Settings on iPhone, iPod touch, and iPad (recommended /wSB)

Create an icon in the following two sizes:

58px x 58px29px x 29px (standard resolution)

iOS 6.1-

iPhone Only

Image(px)   File Name          Used For                          Required Status512x512     iTunesArtwork      Ad Hoc iTunes                     Optional1024x1024   iTunesArtwork@2x   Ad Hoc iTunes HiRes               Optional57x57       Icon.png           App Store and Home screen         Required114x114     Icon@2x.png        Home screen iPhone 4/5            Optional72x72       Icon-72.png        Home screen (iPad compatibility)  Optional29x29       Icon-Small.png     Spotlight and Settings            Optional50x50       Icon-Small-50.png  Spotlight (iPad compatibility)    Recommended(/wSB)58x58       Icon-Small@2x.png  Spotlight and Settings iPhone 4/5 Recommended(/wSB)

iPad only

Image(px)   File Name          Used For                          Required Status512x512     iTunesArtwork      Ad Hoc iTunes                     Optional1024x1024   iTunesArtwork@2x   Ad Hoc iTunes HiRes               Optional72x72       Icon-72.png        App Store and Home screen iPad    Required144x144     Icon-72@2x.png     App Store and Home screen HiRes   Optional50x50       Icon-Small-50.png  Spotlight on iPad                 Optional29x29       Icon-Small.png     Settings on iPad                  Recommended(/wSB)

Universal Apps

Image(px)   File Name          Used For                          Required Status512x512     iTunesArtwork      Ad Hoc iTunes                     Optional1024x1024   iTunesArtwork@2x   Ad Hoc iTunes HiRes               Optional57x57       Icon.png           App Store and Home screen         Required114x114     Icon@2x.png        Home screen iPhone 4/5            Optional72x72       Icon-72.png        App Store and Home screen iPad    Required144x144     Icon-72@2x.png     App Store and Home screen HiRes   Optional29x29       Icon-Small.png     Spotlight and Settings            Optional50x50       Icon-Small-50.png  Spotlight iPad                    Recommended(/wSB)58x58       Icon-Small@2x.png  Spotlight and Settings iPhone 4/5 Recommended(/wSB)

*(/wSB) = Recommended if you have a Settings bundle, otherwise optional but recommended

Red,

Please follow these guidelines: http://developer.apple.com/iphone/library/documentation/userexperience/conceptual/mobilehig/IconsImages/IconsImages.html

I have not seen the pixelated issue on the iOS4 simulator like you did using an app that was originally written for iOS3+ with a standard 57x57 icon.