How do I make lines pixelated like they are in MS Paint? When working with particularly small images like 128x128 px, it is important that shapes and lines be pixelated and not all smooth.

Example

Hi.

In the document's settings (Shift+Ctrl+D) switch off the "use anti-aliasing" box.

If you'd need your images to be fully black or -white, presumably- try to work with this template file:
black or white

Are you sure you need a vector editor like Inkscape? Maybe a pixel editor would be better?