I have yet to find a free or open source solution that's incredibly easy to implement and embed (for bloggers). To get PDF content showing nicely inside of a scrollable iframe, you need to convert the PDF to HTML, and host images somewhere. That's not easy for people who just want to jump right into publishing blog content. DocumentCloud seems totally awesome, but their hosted platform is restricted to journalists; specifically, "newsrooms."
I use Scribd for legal research; there's a lot of attorneys who post PDFs of case pleadings, since (a) PACER is expensive to use, and (b) RECAP has terrible searching. To that end, it really is the YouTube of PDFs, and I love it for that. Of course, YouTube is ad-supported, so perhaps that'd be a better option for Scribd, but that tends to draw ire too.
For what it's worth, you don't need to pay for a Scribd account if you regularly upload content. I haven't uploaded anything in a few months and I was able to download, for free, the Declaration of Independence link that the author highlighted. Of course, you wouldn't know that unless you stared at the little text on the bottom of the page, so that should change.
I don't hate them (my wallet does, when the content I want is behind them of course), but I find it to be a pretty reasonable model. Have a bite of the content, if you enjoy it then pay for the rest. It doesn't seem crazy to me that people should be compensated for their work, and while the "pay what you want" model is a lovely ideal, some people are more comfortable putting a fixed price on it.
I'm not asking to be combative, I'm genuinely curious on whether or not you have a better solution, and I'm totally open to having my opinion of pay-walls changed if I've overlooked some flaw in that model.
There IS a case where paywalls work and work well -- if some of the value in the information is information asymmetry. This is why the Wall Street Journal works better behind a paywall than the New York Times does -- the audience for the WSJ is a bunch of people who deal in investing, where the value sometimes isn't in merely being informed but being more informed than the others.
Free, open-source, embeddable, ad-free, and accessible to anybody.
Disclaimer: I'm the creator of PDFy.