I don't know where you are getting the impression that ISRO engineers aren't paid well. Sure, they are not paid Google salaries but they are no way paid peanuts. A fresh engineering graduate will stand to get around 40K INR per month. Please not that if you are not landing up a software job, in India, it's a pretty shitty market out there for other disciplines. ISRO offers are great when you consider for example, what a mechanical engineer makes in other private companies.
Working environment is also comparable to any software facility. Please visit the ISRO facility in Bangalore on old airport road. They have some of the most green and spacious campuses. I don't have pictures because security is super tight and they don't even let you carry your cellphones inside.
For a long time, ISRO offered some of the best retirement benefits. My dad and mom don't have to worry about their healthcare costs for the rest of their lives and my dad gets a handsome pension to take care of his day to day living expenses. This has changed with the sixth pay commission.
ISRO also offers housing in some prime areas, near the office facilities so that you don't have to commute much. Of course, not everyone gets this benefit and it's based more on a lottery basis.
The schooling for your kids is almost free in the Kendriya Vidyala schools - and some of those schools offer top notch education.
While you are employed, you pay next to nothing for healthcare (including surgeries). There is the CGHS card that you flash in almost all major hospitals and you are taken care of.
As if this was not all enough, you get to work on some really state of the art stuff that others can't even imagine. There is absolutely no room for error. You just can't say 'oh crap I'll just fix that bug'. One bug might destroy a satellite or screw up the rocket launch. So, there is a lot of merit in building such mission critical systems and a ton of satisfaction. This satisfaction cannot be compared with money.
During launch days, my dad would work 3-4 days at a stretch without even a phone call in between. Such was the pressure.
So, working at ISRO has a ton of merits and satisfaction. It's not for everyone though. There is no glamour as such in the job. You don't have crazy parties or drunken revelries or annual outings to Hawaii. There is an enormous amount of bureaucracy and bull shit that you have to deal with. But for an engineer who loves to build mission critical applications - the place is a heaven.