As someone who has worked on all three sides of the equation (selling ad space, brokering ad space, and buying ad space), I can tell you wholeheartedly that ad purchasing companies do not want these clicks. They're paying for something of no value.
I don't know how companies can be convinced to do ad placements like these, or if they simply rely on getting enough conversions from accidental clicks from unknowing users to make out in the end.
Either way, it's a bad practice and something I'd equate with a torrent site or rapidshare.
Ads like this are typically bid on on a CPC basis. Shaky grandpas who click ads on accident and don't convert drive down the cost of the clicks. If you assume shaky grandpas account for 50% of the clicks, and 0 convert, then they'll make the CPC worth half what it would have been without shaky grandpas. As a result advertisers will bid half as much and pay half as much as CPCs. Just like click fraud, unless it's an orchestrated attack on one specific company, it comes out in the wash.
In the end, the advertisers don't really care (at least if they understand the math, which many don't). They care only about their ROI. If they pay 20 cents a click and make 40 they're happy, if not they aren't. Sure you could perhaps get rid of all the shaky grandpas, pay 40 cents a click, and make 80, but it's the same ROI.
What you really end up with is a cottage industry of people making websites that can convert shaky grandpas better than real advertisers because just like spam, some non-zero percentage do convert. That's why you see some stupid ID fraud ad there. Shaky grandpas are terrified of the evil hacker who wants to steal their identity.
Well, from yahoo's perspective it's 10k clicks at 40 cents cpc vs 20k clicks at 20 cents on the same number of impressions. From the advertiser's it's which do you buy, and the latter is almost certainly preferable since some number of shaky grandpas will convert.
I think shaky grandpa should be the internet standard term for worthless clicks.
A lot of products are targeted at confused and befuddled people. The "Protect Your Identity" ad could be an ad for one of those, in which case Yahoo's optimization process has placed it very well.
Unlike the ad in the article, Adword ads are usually highly relevant because they often capture the same intent as the first organic result (if done right).
I don't know how companies can be convinced to do ad placements like these, or if they simply rely on getting enough conversions from accidental clicks from unknowing users to make out in the end.
Either way, it's a bad practice and something I'd equate with a torrent site or rapidshare.