This, the 3DS plays DS games natively because it has all the necessary hardware required to do it without resorting to emulation. 3DS uses a newer ARM11 processor, while the DS used both an ARM7 and ARM9. Newer ARM chips are naturally back compatible with code for older ARM CPU's. This is also the method that the 3DS plays GBA ambassador games as well.
And no there's no change to the way DS games display on 3DS. It's not something they can just fix easily with an update. Nintendo provided the two best ways of viewing DS games on a 3DS. If they removed the blur filter, the games would look far worse than they do now with the pixels stretched unevenly (3DS doesn't have exactly 2x the resolution of the DS like the Vita did with PSP, stretching DS games to full 3DS resolution without a filter applied would make it look even worse).
I don't know whether they could do anything to improve the quality of the filtering method used (likely not much), but they likely won't make any changes anyways even if they could.
From: NeonYoshi11 | #003
They look fine to me but I never owned a DS..
You probably won't notice anything unless you've had experience playing the games on a DS. When you boot up DS games on a 3DS, hold Start or Select while you boot them. This will play the game in a smaller window with black borders surrounding the image. That's basically how they appeared on a DS, you'll notice an absence of a blur filter on the visuals (which is needed to make the games look better when played at full size on a 3DS).
I made this little comparison a while back to hopefully better explain the situation that involves DS games played on a 3DS (and what would happen if they were to remove that blur filter)- http://imageshack.us/a/img851/840/ctds3dscomparison.png
NEVER judge a game you have not played. -Granville