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Lower DPI is quite okay with good font rendering (FreeType, slight hinting, subpixel rendering). I have both kinds of devices.

I get kind of nostalgic when I see Verdana on 1024x768 in winxp/2k.

ClearType was/is a nifty technology. I remember I had a HP Jornada PocketPC that came preloaded with The Time Machine to show off ClearType.