[Phanx]

I assume you mean the names shown over units in the 3D game world when nameplates are disabled. The distortion you're seeing is (probably) due to your anti-aliasing setting in the game's video options. While Blizzard did (finally) fix the rendering of game-world damage text in 7.0, they also screwed up the rendering of unit names. FXAA 2x or 4x makes them pretty much unreadable without zooming in, like you described, so your options right now are:

(a) Turn off anti-aliasing and enjoy ugly jagged lines on everything.

(b) Use an anti-aliasing method better than FXAA and enjoy your 20 FPS minus.

(c) Stick with FXAA and turn on nameplates. (Also enable the "Show All Nameplates" option -- its name is misleading, but what it does is make the game actually respect your show/hide nameplate preferences instead of ignoring the "show" state outside of combat.)

You can also try changing the font used for unit names; it won't necessarily fix the distortion, but if you use a bolder/wider font it may not be quite as bad. There's no way to access the names directly in an addon, or change the size / outline / shadow, but this will work once per login session:

UNIT_NAME_FONT = "Interface\\AddOns\\SomeAddon\\SomeFont.ttf"

Overriding UNIT_NAME_FONT more than once won't have any effect, even if you reload the UI. You have to completely log out to the character screen and log back in to change it again. You also need to do it during the initial loading process, so just stick it in a file outside of any functions, or at least make sure it's not running any later than your addon's ADDON_LOADED event or maybe PLAYER_LOGIN at the latest.