Well it is limited by Emacs' display engine. It is obviously not supposed to replace your default browser. But it is usually good enough to view html documentation. Which is really something you want inside your editor.
Also, is this display limitation a function of the OS? In which case, shouldn't Cocoa/GTK or other versions not have this issue and be able to actually embed nicer rendering in there with nice fonts?
Is it? I'd much rather have proper HTML rendering in another window than a kludge "in my editor".