So you’ve upgraded your XP to Windows 7, Linux, or Mac OS X and decided to keep using Windows XP in a Virtual Machine so you can run those old, incompatible applications that don’t work anymore on your platform. So why does XP look so awful in a VM?
The problem is most likely because ClearType is not enabled by default when you setup Windows in a virtual machine. For example, take a look at these two shots:
Without ClearType (notice the jaggy fonts)
The second screenshot is a lot more readable, especially on an LCD screen.
Enable ClearType in XP
Head into the Display Properties via the desktop context menu, open up the Appearance tab and click the Effects button.
Then change the drop-down to ClearType instead of Standard.
The changes should happen immediately, and no more jaggy screen fonts in your virtual machine. I would also show you how to enable ClearType in Windows Vista, but I can’t think of any good reason why you would use Vista in a VM instead of XP.