Pixelated and Blinking image at night
The spotlight on the Essential isn't the brightest (~100 lux) - it's really to help you get color at night. If you want bright, use one of the separate lights (400 lux) from Arlo or the Pro 3 floodlight (2000-3000 lux, depending on whether it's plugged in).
As for the image quality, is it only at night? That's a bit odd unless some wireless device that only operates at night is causing interference. Is this connected to your WiFi or a base/hub?
You can use the Share selection for a video in your library and post the link here (the link is only good for 24 hours).
DO you have another camera to swap around with to see if it's the camera or location? If not, swapping at the store would be a quick way to test or buy a second camera (with a return privilege) for testing. You can also move the camera closer to your router to see if that makes a difference.