How is it possible that the dharmic religions have a hell that seems
much less worse than those of the Abrahamic tradition, but both are
considered the paradigm of the ultimate bad?
The same definition doesn't always mean the same actual thing/experience.
Let's begin with a simple matter of definition: let's say "Hell" (or the equivalent notion in any language) is the word chosen to describe the notion of "ultimate bad"
Now we think we are in agreement over the meaning of the word, but what each of us think of when hearing a word is still different in each person mental representation. If I say "dinner table", everyone might agree on a definition "it is where you eat your meals on", but western people might think about a rectangular familly table, no wait, may be it's a round table, anyway, it surely has 4 legs long enough so I can eat on it while sitting in a chair. Yet, a Japanese person might visualise a very low table with short legs, so you eat on it while sitting (or kneeling) on the floor. And what about my Thai wife, for who the "table" she eats on is a rice straw mat unrolled just before the meal and rerolled away as soon as finished.
All this to say that a common definition, even shared across different languages or cultures, only define a notion or a function, but it does not always carry enough detail to insure an exact similarity in the mental representations of different people, or even in its physicallity.
Consider that for a "dinner table", which is a physical object, which you probably observed, used, felt and touched several times in your life, and now extend that to immaterial things, like the notion of "Hell" ... Of course it can carry the same definition and yet mean different thing for different people.
That, I hope, answered the "How is it possible that ..." part of your question.
Origin of the difference:
The next part of your question I need to frame challenge it a bit: "... Dharmic religions have a hell that seems much less worse than those of the Abrahamic tradition."
"Worse" is very subjective, let's drop it momentarily from the question and simply rephrase like "How can they be so different".
I've described how Hells can be different while still carrying the same definition, but where are the differences coming from?
Dharmic philosophies have less absolute (than Abrahamic). In these, although God(s) can exist, they are not central to the philosphy. They are higher beings than humans, but still have to be bound by rules dictated by even higher principles on how the world/universe function.
One very important rule, under which even (Dharmic) gods are bound, is Impermanence. Nothing can ever stays the same for ever.
On a human day-to-day scale, this is often repeated to prevent or limit sadness at unexpected or sudden event (like "loosing" things or a dear person). On larger scale, they deemed the principle sound enough to extend it even to thing that appear permanent from our human viewpoint. For example: the dance of the stars above us, which seems to repeat year on year and generation after generation. Even without seeing a difference, someone believing in impermanence will know that it is constantly changing, it's just that the changes are under our detection capacity.
So naturally, with impermanence being such a strong tenet of these philosophies, when some scholars went on to describe "Hell, the worst place to be", they imagined a place with the worst conditions to live/be for a human (after all a bit of scaremongering is all what Hell is about), but they could not postulate it infinite in time as it would break an important pillar of their belief.
In contrast, Abrahamic scriptures are littered with absolute adjectives and epithets, and of course the most absolute, infinite in power and wisdom, highest being is the one and only God. Him being infinite in power and time, has no problem to create an infinite Hell for his naughty followers. Also, once infinity is accepted for other things, then Hell must be for ever too if it has to carry enough fear factor, otherwise it would just be a bout of bad time in an otherwise infinite "life".
"Worse" is subjective
See how the end of the last paragraph above almost describes why you stated one would be worse than the other.
It only seems "much less worse" for your perspective, in the context of your beliefs. If you believe in infinity, then sure the worst things that happens to you is going to be more annoying/painful(choose your adjective) if it last for an eternity rather than a finite amount of time.
But now consider the worldview where "impermanence" is the only infinite thing (things always change and never stop doing so). Whith this belief, the Dharmic Hell is still "the worst place you could be", and even if it is for a finite time, it is not pleasant to think that you'll have to do some time there. On the other end, landing in a place which is said to be "permanent", even if it is an Abrahamic Hell, for a Dharmic follower it would actually means escaping the never ending suffering of life, birth, rebirth and change of existencial plane, which Dharmic traditions identify at reaching the Nirvana, or (very loosely) tranlated: Paradise.