Microsoft quietly added the capability for font anti-aliasing (font smoothing) in Windows XP Service Pack 3.  This applies to Terminal Services (Remote Desktop / Remote Assistance) connections. This is very easy to do.  Just open up regedit (Start->cmd -> regedit) and make the following change:

[HKEY_LOCAL_MACHINE\SYSTEM\CurrentControlSet\Control\Terminal Server\WinStations]

New DWORD Key: AllowFontAntiAlias

Value: 00000001

That’s it :)