OK, I hate replying to myself, but this is a pretty significant and contentious issue, so I think it's worth it.

Here are some example of folks who I think "do it right", or at least well, relative to the standard "slap ads on and forget about it" model:

Penny Arcade (a web comic, for those who don't know). Firstly, their ads have always gone through a rigorous selection process. Most ads are for games and the site owners demand that they play the games in the ads and they only pick ads for games they actually like a lot. Thus the ads serve as recommendations more than anything, they are not just hijacking your attention they represent actual value (the effort put into reviewing the games). Additionally, PA has a line of merch which includes not only t-shirts and posters but also collections of the comic strip organized by year in physical book form. Beyond that they also run a major gaming convention (Penny Arcade Expo / PAX) and have other projects (such as PATV). This provides diversified sources of income all founded ultimately on the fan base and enthusiasm for what PA does and is about. More so, last year PA launched a successful kickstarter to remove the main banner ad from the site and, as one of the stretch goals, to kick off a major content production (the web video reality-show called "strip search"). Now, not every web comic is going to be able to do all of these things but these are good examples of how you translate "what you're good at and what you do" into money.

A similar example would be "A List Apart", a web design blog. There are very few ads on their site and those that are there are highly relevant to the readership. More importantly, ALA sells books which include material that has already been on the site as well as new material, and they run the "An Event Apart" design conference.

37 Signals falls into a similar pattern. They sell collaboration, project management, and contact management services but they also have a well regarded blog. They sometimes package up material from the blog into book form, which they sell, and they have significant contributions to major open source software projects (such as Ruby on Rails). All of these things together help further their brand and drive business to their services and books. Their blog has a small number of highly relevant ads. Indeed, they helped found an ad company which serves well-vetted highly relevant ads to a cohort of web sites that are all generally focused around web design.

Stack Overflow / Stack Exchange. They have a small number of highly relevant ads (I detect a trend). Also, if you are a regular user of the site then you won't see the main banner ad on question pages when logged in. They also monetize through jobs boards, CV services (which provide a great synergy with use of a site and help show off your expertise directly), and amazon referrals.

GitHub and Dropbox have free service tiers but also charge money for their services, and GitHub has a job board.

There are a lot of broad trends here. The best ads are those that add value rather than try to hijack the user's attention, relevant ads that have had work put in to ensure they are relevant, and ads that are not intrusive. If your site is mostly content focused then finding ways of repackaging content and selling it directly can bring in plenty of income. As can finding ways to allow your fans to express their enthusiasm and trust for your content by buying things (merch) or attending events. And leveraging whatever it is users get out of your site through additional services.

If users are going out of their way to block your ads that's a signal, it means that they find the ads are providing negative value to them. And that's often the result of allowing ads to have negative value, by simply passing them off to folks who are willing to pay money for the possibility of infringing on your readers' attentions. Otherwise known as spam. Would you change your site to one where you required readers to give an email address and then you sold all of those addresses to spammers in order to make money? That's what many sites are effectively doing by being so indiscriminate about advertising.

If you're not thinking about how your site is making money and whether that method makes sense, is sustainable, and adds value to your readership then you're not thinking about it enough. You're taking your readers for granted.