It's not primarily that people are bad at math. It's that they don't see any other way out. I've seen data that show that people play lotteries "for money" at higher rates the lower their income is. I can't find the exact citation, but here's a CMU article about study that shows something similar: http://www.cmu.edu/news/archive/2008/July/july24_lottery.sht...
We really just need to end state-run lotteries. The problem is that the states depend on this regressive tax for revenue.