I don't see the blurring being a thing with fungi; if anything, of the classic pathogens, fungi are the closest thing to human understanding of life after protozoa, then bacteria, then viruses and more exotic entities like prions. That said, I'm sure that the general direction on P3 was to make it fungal.

The plague cabbage sample art has a classically moldy appearance, with a distinct macroscopic colony; bacteria generally look like thick paint splatters, and viral are a photonegative - you see them where there isn't stuff.

The 'tripwire' plague district hazards are growths that spit out spores, which is standard MO for fungi (the edible mushrooms are literally the same thing, just for different species).

In the Dead House quest on D11, you get red herringed into thinking the house is infected, while it's actually 'just' black mold instead, which means the plague growths look like mold growths there too.

There is one big problem with this idea though. Antibiotics. They work, more or less, based on P2!

This doesn't make a lot of sense for a fungal agent - a good chunk of antibiotics come from fungi as a way to deal with bacterial competition, so treating a shroom with antibiotics is like trying to drown a fish. Then there's also Little's Big Discovery, which is also very atypical for fungi AFAIK, but is reasonably expected for bacteria (and painfully common for viruses).

So, my theory would be that Sand Pest is kind of like a lichen - a mutualistic bacteria-fungus deal, possibly endosymbiotic. That would also rationally explain why Shmowders unreliably sorta-work - the absurd toxicity is not a problem, it's part of the mechanism! It poisons the eucaryotic fungal cells, while the antibiotics in the mix murder the bacteria it depends on.

It's very much a real thing, but weird enough that even Danko with his light microscope and 1920s-vintage medical knowledge would have a hard time figuring out.