Of course it will turn away some visitors!
When somebody needs to register in order to use a site, he's asking himself additional questions, like:
- Which informations do I have to give? How much time will it take me?
- Which value does the website give me?
- Is the value more than the effort I need?
- Can I trust this site to keep my credentials secret?
These additional concerns increase the user's "cognitive load", that means, he has less "capacity" to do what he actually came to do on the site (even if this is just to explore what this site is about).
So, in order to avoid losing visitors:
- Allow reading your site's content without login
(recommended also because search engines can't log in)
- Make clear what advantage a registered user has
- Allow the user to register later on, when he got convinced of the site.
(e.g. Lazy Registration Demo and more examples)
Facebook Connect (and OpenID, OAuth etc.) would take a bit of pain out of the registration process, but I'm not sure about which kind of/how many users use them - anyway, you would have to find out for your specific audience how many of them already have a Facebook account and used Facebook Connect at least once.
If it's only about customizing the experience (no personal/secret data or privileges, but rather display preferences, language etc.), a simple cookie may do.