This thread contains the merged recent discussion from three closed threads on color banding in clouds and in the sky as well as to the general “felt” loss of quality of clouds.
A similar question like in the OP has been issued for the postponed Q@A here:
https://forums.flightsimulator.com/t/can-you-explain-the-changes-in-su5-that-lead-to-color-banding-and-fringes-for-many-user-on-sdr-monitors-and-are-they-fixable/443671?u=toml7753