Can lack of update cause screen distortion? I have an LG X Power running on Marshmallow. I have not installed the latest security update, as it causes problems not only with my favorite game, but also an app I NEED to sign into my work email. (I know this because I had another phone exact same type that screen cracked so I replaced it)

About a week after I got my new phone tho, the screen started doing weird things. It at first just goes a little blurry, then it looks like it is almost doubled. The worst full distortion is a bunch of lines all over the phone, with the screen still usable and visible...sort of....but everything looks blurry/doubled and it also messes with the correct placement of things.

Is this screen distortion possibly because of the new update? Should I just return the phone under warranty?

Please - any help is appreciated!
I'm not sure if I understand you, did you allredy sent that phone to repair or you bought new phone? However here is the thing: update or lack of update shouldn't mess up screen like that, the simptoms that apeared is 99% hardware issue, screen or gpu is dying. But just to make sure that isn't up to Android system you should perform factory reset before sending it back since it's under warranity, or you can try applying update if possible to see what happens.