It does target to the user based on your searches and other things (assuming you're cookied). It just doesn't ask for explicit input from the user which is counter to the "google way" of abstracting that kind of control away from the user.
Personally I would. If it peaks my interest I will look, I'm not interested in "low rate mortgages" or "win a free(*) iPod". I own an iPod and I have no interest in owning a house, which is why I now own Adblock Plus and Flashblock. I hardly see any adverts anymore because they annoyed me by not targeting me.
Context ads are good, except when the ads aren't in the context of the site. Just because sex gets mentioned in an article, doesn't mean I want adverts for sex pheramones and when I read something on bargains on HDTVs I do want Bestbuy, FutureShop or eBay adverts popping up as I'm actively looking to buy something.
Ads I would like to see: none. If I can't have that option I'm going to cast my vote with Adblock on FireFox and you're not going to get an option. Find a better way to monetize pls kthx.
