Sure, the idea of making a little money for the stuff I posted was nice, but to me, the free hosting is far more important. Especially hosting that is so much easier to use for both uploaders and downloaders.
For suggestions, I don't have much. I do think that the idea of paying per download instead of per page view as someone else suggested would be a smarter plan. It would encourage quality since if it's junk, no one will download and with IP tracking, it would be a little harder to abuse I would think.
On the quality issue though, I've been wondering lately why you don't see any groups for Freestuff creators like there are for merchants. Or at least none that I've heard of. Perhaps if one was created, while it wouldn't do a thing about those who are just in this for the quick buck, if done right it could be highly useful for those who want to put out quality work.