Sony's XH90 TVs cannot game at true 4K and 120 Hz
Sony unveiled the XH90 in May, promising that its TV range would be 'ready for next-generation consoles'. By that, Sony meant that the XH90 would support 4K gaming at up to 120 FPS, a feature that the company would subsequently enable via a software update. In July, Sony bragged that the XH90 range would offer input lag as low as 7.2 ms, but people are unhappy with the quality levels that the TVs are offering at 4K and 120 FPS.
Based on the findings of @EvilBoris and 4KFilme, the XH90 cannot output at 4K and 120 FPS. While assets look crisp at 60 Hz, there is excessive blurring at 120 Hz. According to 4KFilme, image blurring sets in at as low as 100 Hz. The German website speculated that the XH90's image processor may not be powerful enough to output content at 4K and 120 Hz, which is what HDTVtest claims Sony has confirmed privately. The quote posted by HDTVtest from Sony is as follows:
When playing 4K 120 Hz, the TV will have to process loads of data, and in some cases leading to bandwidth limitation slightly because 4K 120 Hz has huge amount of information in itself.
In this case, we prioritize smoothness of 4K 120 Hz because we believe customers' expectation will be the smoothness.
Apparently, Sony has 'tuned the signal processing and the picture quality' so that there are no issues 'in any kind of circumstances' when displaying moving images at 4K and 120 Hz. However, this reads as though Sony has to employ workarounds to get 4K and 120 FPS working on the XH90 range, rather than it being a native feature of the TVs. Considering that Sony has made 4K and 120 Hz one of the main selling points of its XH90 TVs, then we would expect the feature to be fully-fledged, at the very least.