I agree that Reddit is taking a naive view on Advertising. There is a huge amount of value to be added here, both to Reddit and the Community by an effective Advertising platform. I'll speak with examples:
r/gaming, a post about Borderlands2 with a sponsored ad that links to one-click checkout on Steam.
A post about Romney's many lies featuring a donate to Obama link, or vice versa.
Featuring a sponsored Ad to a local crossfit gym that is having a free trial.
To pull this off they need much better Advertiser control, sentiment analysis of posts, and inclusion into a larger Ad Exchange (or offer Reddit inventory via an exchange model).