WPF 4.0 notoriously fixed the blurry text issue. Setting TextOptions.TextFormattingMode=\"Display\"
uses pixel hints to line up characters, which works really well
UserInterface code in windows service is not a good idea its an unsupported scenario. The same limitation was there with GDI+ (System.Drawing.*) and same limitation applies to WPF also.
RenderTargetBitmap always renders in software. Not sure if that is the cause...or a bug, but in any case the result is that RTB does not seem to honor the text options.
What if you create your RTB at twice the resolution, then scale the image back down to the visuals native size. A poor man's anti-aliasing.