Installing Apple's newest version of iTunes (4.0) made the "Small" fonts turn non-anti-aliased (ie., not "smooth"). To fix this, open System Preferences and go to the General pane. If you set the "Turn off text smoothing for font sizes __ and smaller" to "8", your iTunes window will look pretty again.
[robg adds: I noticed this immediately; the "Search" text below the search box was nearly illegible. I thought I might have a corrupted font, but a bit of stumbling through the prefs panels found this same solution. It seems Apple notched the iTunes font sizes down by one...]
Mac OS X Hints
http://hints.macworld.com/article.php?story=20030428190158726