This is my response, posted against the Debian bug
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Tue, May 6, 2008
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This issue is well-known: it was discussed in the release notes. I
take it seriously, and I'm working hard on a solution.

It is due to the fixed 15% spacing I introduced (see the release notes
under "Line height")
   https://savannah.gnu.org/forum/forum.php?forum_id=5248
in all faces in order to stop the chopping of various high and low
characters, rendering much text unreadable.

It was a choice: What's worse?  What's the purpose of FreeFont?  How
much time do I have?

If you really must have FreeMono drawing boxes in xterms, and you're
only using Latin letters, then I agree that an older version will suit
you better.  The 2006 release of FreeFont had very severe line-spacing
problem that was artificially hacked away by a Debian patch.  This in
turn caused other problems that I judged to be also important.

The box-drawing issue has recently been discussed at some length. In
this discussion,
  http://lists.gnu.org/archive/html/freefont-bugs/2008-04/threads.html
it is argued that the 2003 release of FreeFont was superior on the
basis of xterm box-drawing functionality, even to the Debian 2006
version.

I think it is reasonable for most glyphs to live between the stated
vertical bounds of the font.  For the monospace font especially, such
a limitation is more important than aesthetic balance.  I have now
forced that limitation now on the Roman monospace face and am working
on the others.  But it takes some time.

As to the ideal box-drawing in an xterm, there are various
complications, and cases of smoke and mirrors, on the part of xterm
implementations and console fonts.  I won't pursue this goal very far.

But I have already improved it a lot, and mean to do more.