Hi sandra_p ,
You are correct, this is caused by the DPI Scaling on your local laptop (not the Terminal Server) being set to more than 100%.
Firt of all Log out of Terminal Server (don't just disconnect)
You can change your DPI Scaling settings on your local laptop by going to:
Start -> Settings (cog in the bottom left)
Select System
Select Display
Scroll down to: Scale and layout
In the drop down: Change the size of text, apps, and other items
Change this back to 100%
Your screen will flicker for a moment and everything will get a lot smaller. I should note, these instructions are for Windows 10 only. If you have windows 8 or 8.1, the steps are slightly different.
That should sort it.
Cheers.