Why are quasars so far away that they couldn't be optically resolved in the 1950's?
Quasars have a very low density at the present epoch, but were much more common in the past. Their co-moving space density peaks at redshifts of 2-3.

The evolving space density of bright quasars. From https://ned.ipac.caltech.edu/level5/Madau/Madau7.html.
The fact that the quasar population density evolves was one of the key arguments against steady state cosmology.