If you use MIPmapping, then scaling the font makes it look a litte fuzzy. If you don't use MIPmapping, it'll look horribly aliasy. Texture fonts can be rotated and scaled - although they always look 'flat'. It's easy to convert other kinds of fonts into texture maps. You can draw them in the 3D scene and they will be illuminated correctly.
Textured fonts require just one quadrilateral to be sent to the hardware for each letter.
That's probably an order of magnitude faster than either Raster or Geometric fonts. Since low-end 3D hardware is highly optimised to drawing simple textured polygons, speed is also enhanced because you are 'on the fast path' through the renderer. The 'FNT' component of the PLIB packagage does a good job of rendering textured fonts - and comes with over a dozen fonts in 'TXF' format. FNT is highly portable. Font3D converts fonts into geometry which can be exported into a variety of model formats.