This is no longer true -- there are a few quality typefaces made by professional designers available for open source projects, for example DejaVu, Droid, Arimo/Tinos, PT Sans, Ubuntu. Even Mac OS X uses an open source font for a part of their interface (Menlo, based on DejaVu Sans Mono).
timc is right, what you see is unattractive font rendering (no subpixel rendering, full hinting). For the state of the art of font rendering in open source projects, look at Ubuntu or Infinality.
I think the problem with the font rendering in this screenshot is the hinting. When you hint the fonts too strongly they lose their character and the diagonals' width becomes inconsistent with the straight lines' width, as you can see in the lowercase 'w', for example. If this uses the FreeType library, you can set the font hinting to 'Slight' or 'Medium' and fonts look a lot better.
The hinting looks fine and freetype2 is currently capable of emulating everything OSX or Windows does. The fonts look like (I'm no expert here) they are from the Liberation family that Red Hat created, and I'd agree that they are somewhat utilitarian and ugly.
timc is right, what you see is unattractive font rendering (no subpixel rendering, full hinting). For the state of the art of font rendering in open source projects, look at Ubuntu or Infinality.