WPF text renderer is different from GDI ClearType in that it does not snap lines in character glyphs to pixel columns. As claimed, this is to preserve the correct text proportions. However, the end result is that for on-screen text and relatively small font sizes (such as Tahoma 8pt - the default XP GUI font; and Segoe UI 9pt - the default Vista GUI font), the text rapidly loses contrast and looks extremely blurry.
As a result, any WPF application that tries to look as a stock Windows desktop application (i.e., does not use non-standard or larger fonts) suffers from readability issues. A very good example of this is WPF property grid in XAML designer in VS2008+, and IntelliSense dropdowns in VS2010 CTP. The Expression suite tries to weasel out by using dark background and bright text color, which looks somewhat better, but still not good enough.
Note that the often-suggested (by Microsoft support people) "solution" to tweak WPF ClearType settings by editing the registry does not solve the problem. Recommendations to use different (non-system) font faces and/or sizes and text color cannot be taken seriously either - a stock desktop application should use the system UI text color, font family & size for UI controls, period.
If WPF is to be useful for LOB and stock desktop applications, it should either allow to use the default system font renderer for text (on an opt-in basis), or, alternatively, provide some other means to ensure that on-screen text legibility is at least as good as GDI ClearType.
Some relevant links to discussions, explanations etc, to indicate that this is a well-known issue that is very widely perceived as a serious problem:
Also, a Google search on "wpf blurry text" gives plenty of different hits, most of which are negative comments regarding the issue: