Overview
The email embed code pulls in a small thumbnail of the video from the following line of code, specifically by using the "email=1" query tag:
<img src="https://play.vidyard.com/UUID.jpg?email=1"/>
The image that comes through is a small low-resolution image intended for use within an email template.
Solution
If a higher resolution image is needed, replace the "email=1" query tag with the "play_button=1" tag. This will give the largest resolution thumbnail possible to use with the email embed code. Alternatively, use a screenshot of the player from its sharing page and host it on a link to use as the source in the "img src" tag.