One always assumes that SVG is infinitely scalable. Thanks for brining up this counterpoint. I guess "not everything is awesome".
Hinting is a very complex operation (basically, you align letter's lines with the pixels on the screen) which is only useful when the display's DPI is low enough that you can see the pixels on the screen. SVG was never really intended for these cases, it's rather intended for high-DPI, "next gen" displays. However, I'm not sure if low DPI screens will ever go away. So will SVG always have this "blurry text" problem?
Hinting would be a really cool feature to have but also very difficult to implement gracefully. Usually hinting is done differently on every OS - by the Freetype library on Linux, by ClearType on Windows, and not at all on OSX. That kind of thing is difficult to incorporate into a standard - Do we accept that it will look unpredictably different everywhere? Do we force every SVG renderer to ship with freetype?
Another issue is that you usually want reduced complexity at small render sizes. So you have a few additional .svg's that get used just at one small size.