You probably are gonna have to experiment since I've had mixed results with different games. output=surface is good for general use but as you mentioned the graphics are sometimes fuzzy. Best thing to do is open the dosbox.conf file, change the output= parameter to a different setting, save it then launch your game. Keep trying different ones till you find one that you're happy with. I find that ddraw works good for some games while others work best with surface.
BTW I would avoid modifying the dosbox.conf itself and instead create a separate .conf file for games that require different settings other than the default. For example, Lemmings requires that the CPU cyles be set to lower than 3000 for sound to work so I have a separate conf file for lemmings which I launch with a batch file:
dosbox.exe -conf lemmings.conf "C:\DOSBox-0.72\lemmings\lemvga.exe"
I find this method preferrable since it makes it easier to tweak dosbox for individual games and if you make a mistake while editing you still have the original dosbox.conf as a backup.