A good amount of ink has been spilled on this blog talking about all the cost, nuance, impact, and techniques we go through to get a composited desktop. Less ink is spilled on the benefits of the composited desktop. Those were most broadly covered in this initial post. I'd like to expand on one such benefit here -- High DPI Support (or High Resolution Support).
Monitor resolutions are going up while prices are going down. In general, pixel density is going up as well. Both on laptops that are regularly 120 DPI and 144 DPI these days (as opposed to the typical desktop experience of 96 DPI), and on desktops that are getting bigger and denser monitors. This can make for crisper, less jagged display of content. However, in order for this to work, applications typically need to do work to deal with different display resolutions. (This is not always true... for instance, Windows Presentation Foundation applications are natively resolution-aware, and the application developer needn't worry about it.) When applications aren't written to adapt to different resolutions, they just start to look smaller and smaller on higher and higher resolution monitors.
The seminal article for how to write your GDI/GDI+ applications to be DPI aware was written way back in 2001 by my colleague Nick Kramer, and can be found here. This is ultimately the best approach an application can take. However, not all applications do this, and yet users of course use these applications while they're running in a higher DPI environment. This is where the composited desktop re-enters the picture. As you recall, when the DWM is running, applications render to an offscreen bitmap. When the DWM recognizes that an app is not DPI aware and just rendering as it always does, but that the desktop is set to a non-standard DPI, then the DWM goes ahead and renders the window at a larger size.
This "rendering at a larger size" results in the app being somewhat fuzzier and not as crisp as if it were being rendered natively at the correct resolution. However, it's the "correct" size for everything else on the desktop, and typically represents the much better option between rendering at the right size somewhat fuzzily; or crisply but at a size much too small.
For the purposes of this blog, there are some interesting tidbits about the High DPI rendering that are worth discussing:
More details for the app developer: