I've looked over two threads here on MR about fonts on the Kobo Touch. Several look pretty good, but honestly, I think I am most satisfied with one I found today: Lora from Google Fonts
. In my opinion, it's a beautiful-looking serif font with a nice, tall x height. Very smooth, minimal to no pixelation or blockiness in the curls and serifs and such.
When downloading from Google Fonts, don't forget to check the boxes for all 4 (italic and bold).