Those are done by Pay Per Posts and Blogvertise. I used to do it at my blog but finds it irritating myself since they have some requirments to follow and they pay using PayPal. I think some advertisements they pay low rates but still bloggers take it up and it makes their blog lowly rated... But I don't know since I saw some really write it, matching it to their usual posts...

Some bloggers have high writing skills and write an ads like their usual post...
It's like what you've said and I do see some people actually comment on the ads...

I used to be like that... Worse still I don't have good contents and my blog is full of affiliate banners and pop-ups and java script-based ads... Now, only left two ad panels...

Well, it's always up to you in blogging. If you don't mind no visitors come to read, you can as well. Although some out there will say that you are polluting the blogosphere with splogs.

Agreed. One advise for bloggers is that the more you blog, the more you'll learn along the way. Monitor your trend of vists and page load everytime you change you style and template. That way, you;ll know what can pull readers to your blog.

I see ads as part of the decoration of the blog. Like ads panel provided by AdBrite, you can actually customise them so and impress me, I click on Google ads if I like the site... Lowyat.net has got many from me over the years, it's just a way to encourage site owners but still what I say is up to you to believe...