However nic.ly are now also warning they don't allow ownership of short .ly domains by foreigners, only Libyan nationals. This sounds to me like they want more money or an excuse to take down domains they simply don't like, but is a real problem if they ever decided they want in on the bit.ly action.
The vb.ly site owners keep claiming that the content may be adult but that the domain name isn't. This is a weak argument in my mind, and I believe there's a precedent of domain names registered exclusively for the act of malware propagation being taken down.