I agree with the first part but not the second. What if the best way to show respect for your users is not to pester them with ads and offers, but to let them pay you directly for the value you are giving them?
There would have still been outrage, but people pay to get rid of ads on services all the time.. particularly if they want to continue a streamlined experience. If not, they can tolerate the ads. But using my photos as ads? If I opt-in, sure. But I don't want that by default. I'd rather see something irrelevant than have my likeness potentially supporting a business I don't want to.