It would help if you post a screenshot of your OBS window to show what you mean.
In general, OBS has a canvas - this is a frame buffer you see in the preview. Every source you add is painted on this canvas. Many people just use one source (display capture), but you can add as many sources as you like and composite a complex video layout.
The resolution of the canvas should correspond to the resolution of the thing(s) you want to record. You can set the canvas resolution in Settings > Video, and the default is the windows desktop resolution. Usually, this is just right if you just record something with display capture, which has the same resolution.
It might help to reset the transform for your source - may be you increased its size by accident: right-click the source > Transform > Reset transform.
You can also make the source fit the canvas: Transform > Fit to screen. Don't use stretch to screen, since this will distort the image.
