This isn't really a problem for people who still use CRTs, as they can use their adjustment dials to stretch virtually any picture to fill the screen. As most people use LCD monitors, I will limit my discussion to those.
For games that use a 640x480 resolution, its not so bad because the monitor can scale that. How well it can scale that depends on the monitor. For mine, which has a native resolution of 1280x1024, a 2x setting in the monitor will work fine (although it's still a bit fuzzier than doubling the pixels) with borders that are generally unnoticeable. Games that use a 320x200 resolution work even better using direct3d under ykhwong's build, which actually gives a proper scale.
But games that use a 640x350 or 640x400 mode can be more difficult to fill a screen. A 2x scale will still give you large borders and there is no way to obtain a correct aspect ratio while ensuring all the pixels remain the same size. Having the monitor expand to maximum will make the graphics very fuzzy. Of course, if you had a 1920x1200 resolution monitor, 640x400 isn't a problem anymore with a 3x scale, but it won't be in the correct aspect ratio.
The problem with using stretching scalers in high resolution is the performance hit the system will take by rendering the pixels multiple times. Many games that use a 640x480 resolution don't work fast regardless of the host system's speed. Using a scaler would reduce the game to a slideshow.