You can't gain performance by decreasing resolution when it's physics calculations on the CPU that are causing performance issues.What middle ground? 20fps@900p? That would be a terrible middle ground.
These consoles are very weak, with crappy outdated laptop CPUs. Shits gonna give, especially with such a main focus on physics calculations. They did what they could to get it running acceptably, and that's fine.
They boned up on the GPU side where there are plenty of resources, especially on Pro and X.