My friend used the "I'm doing this for a living, so pay me" model, which has worked out very well for him. He was a radio talk show broadcaster and after one more format change (after CBS sold off stations to Alpha Broadcasting) and decided to found a subscription version of his same show. Two to three hours of show every week day for $7/mo. He had 500 paying subscriptions in the first day and has been making enough to pay himself, his co-host, production costs, leasing an office and building a studio in it, an assistant/booker, and pay all of the royalties (BMI, ASCAP, etc).

I'm undecided which model is truly the best, however. Purely ad or donation based content will surely acquire a much larger audience, but is that worth anything other than ego-stroking, if you can make the same living off of a couple thousand people willing to pay you to do what you do? Of course, it's likely a different proposition to take someone and ask them to do what they do for a profession for free (or donations, etc) versus taking someone who is doing it as a hobby or a starter project and looking to build up from there.

Adam Curry and Dvorak do the "donate" thing with the caveat that "as long as you keep making it worth our while, we'll keep making content". Of course, something like one percent of their listeners actually contribute (but boy, they contribute a lot). I tend to adhere more to the idea that you only ned a small number of true fans to support you and you can just cater to them. If you get the same income either way, then it seems the only benefit of a massive audience that mostly doesn't pay is that you can hopefully springboard that into a paying gig somewhere on a big time site or in some form of traditional media.