I use them in a few different spots on my forums... showthread, forum home and forumdisplay (towards the bottom on all of them). It doesn't bring in much, but it brings in a few bucks here and there that goes towards helping me pay for hosting. I have them set up so only guests and nonpaid members see them. Membership on the forums is $20 a year and buys you ad-free plus several other perks.

I do try to make the ads as least obtrusive as possible. I have found that putting them towards the bottom of the thread by quick reply helps a good bit. People see it when they reply and it's relevant to the thread content.