The pixellation here is your phone waiting to download the higher-res vector tile. While it waits for the higher-res tile it draws a bitmap representation of the lower-res tile "above" it.
They're not infinitely vectors. They're still tiles. If they were to use the zoomed in tile, when zoomed out, even with vectors, you'd get something unrecognizable.
It's the same reason that fonts and icons are brought up when people espouse the "vectors will save everything"! They do a lot of nice things but for something like Google Maps, I can't imagine how they'd implement "true vectors" in a practical phone-applicable way.
I don't see these blurred pixels on my phone, but note that this kind of rendering can also happen with a vector based map: The application has to convert the vector information to a bitmap anyway, for a given zoom level. When zooming in, it is possible that the app shows a zoomed-in version of this bitmap while it is generating a new one in the background.
By the way, it is not necessary to answer every single comment with a link to your screenshot. It is annoying to see the same thing repeated 5 times when reading the thread.
Same version here though the UI looks very different. I can actually reproduce what you describe but only at low zoom levels, which makes sense: the temporary display of a bitmap at the wrong zoom level is more apparent when the phone needs more time to render a lot of vector data (there is less data to render when zoomed-in).
The ability to zoom to arbitrary levels with no pixellation seems to imply it most definitely is vector.