That is definitely not true!!! Hapag Lloyd together with LTU and Condor is one of Germany's most reputable charter airlines. True, they are mostly for tourists and usually quite full, but they are also cheaper than regular flights. The service is comparable to other airlines in economy class. No personal monitors but decent food and service for the price you pay, and the 738s are very new planes. Some carriers offer a better class on charter flights now, they're called 'comfort class' or so and offer more leg space, better food and some other little extras, for just a little bit more $.
But flying HF won't get you any miles at all.