Etymology
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muzzy (adj.)

"confused, dazed, stupid, tipsy," 1720s, perhaps from mossy, or from dialectal mosey (adj.) "moldy, hazy; stupefied with drink, dull, stupid."

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Definitions of muzzy

muzzy (adj.)
indistinct or hazy in outline;
Synonyms: bleary / blurred / blurry / foggy / fuzzy / hazy
muzzy (adj.)
confused and vague; used especially of thinking;
Synonyms: addled / befuddled / muddled / woolly / wooly / woolly-headed / wooly-minded
From wordnet.princeton.edu