You can make great content using block letters in Minecraft signs, with two letters per sign. Full-block and slab-block characters are easier to work with than quarter-block characters.

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Make sign text in vanilla Minecraft 1.20

I found it easiest to use a text editor that supports Unicode, like VSCode, and insert that into text for a Minecraft command.

A command to create a sign with text:

/setblock ~ ~1 ~ oak_wall_sign{front_text:{messages:['["line 1"]','["line 2"]','["line 3"]','["line 4"]']}} replace

You can change this to write a different message on the reverse, and make the sign face another direction with attribute facing:'east'.

Full block characters

These full-block characters are good for creating blocky shapes and 9 × 4 pictures in five shades, but with only four rows in a sign, it's a challenge to make good text with them.

Half-block and quarter-block characters

Use these to create 8-row bitmaps on a 4-row sign. However, alignment is tricky, because block widths vary.

Pasting to the Minecraft command line converts special spaces to normal spaces, so you'll need to paste special spaces directly into the sign. Rather than confuse regular spaces with wide spaces, try entering # for wide spaces for the command line, and then replacing each # with a pasted wide space in the Minecraft sign editor.

/setblock ~ ~1 ~ oak_wall_sign{front_text:{messages:['["▀██▀#██▀▀"]','["#██##██▄▄"]','["#██##██##"]','["#▀▀##▀▀▀▀"]']}} replace

A better Minecraft

If you're in control of the server, you can use a texture pack with a modified unifont.zip, or use mods for a different sign block that displays large text.

Notes

1. UnifontEX still has narrow quarter-block characters.
2. unifont.zip characters are unsupported in Minecraft Bedrock Edition [minecraft.wiki].
3. There is no 5 px space character, which you could use to keep columns aligned with 5 px blocks.
4. A 5 × 8 matrix is ideal for block signs. However, we'd need 10.6 full blocks (or 84 pixels) per line, and Minecraft won't allow that with the current font.
5. Mixing the quarter-block characters with the others will usually result in misaligned columns, even after adjustments with space-like characters.
6. You could use formatting codes in your sign text, for background-coloured blocks, but this might not work well with glowing text, and colour codes might contribute to character count.
7. For public SMP, it's difficult to moderate content if your text is not directly machine-readable. There again, players have always been able to create letters from minecraft blocks.
8. I was thinking of making a web app to generate these signs, but the steps would still involve work for users.