For some brands, like Disney in you example, spraying ads everywhere is good enough. For other brands that is not good enough, feminine hygiene products would be an example (both age and gender specific where IP alone would be a poor indicator).
Targeted ads, even imperfectly-targeted ones, are "less wasted" than other kinds of ads. They are not perfect, by far (thankfully, if I may add so!), but "not good enough?" Come on, what exactly is good enough, then?
How do you know that your 'targeting' is working? If you target females how do you measure how many females saw the ad? Targeted ads should go to the targeted audience or they likely went to waste - at least the advertiser didn't get what they paid for. The quality of your targeted audiences matters to your advertising customers.
> Advertising that is relevant to my wife probably isn't relevant to me, using IP is not good enough.
Advertisers do not care about what you as a human do in the same way that e.g. some government agencies might. Both the paper and you talked about "user tracking" in the context of advertising. My claim is that "IP address identification is actually 'good enough' for advertising" (for some kinds of advertising, at least, but the discussion here is complex and I really don't want to get into it - on short, the problem is not so much with the 'tracking'/building the profile, but with being confident enough that you're not targeting the wrong person/household member during the delivery of the more sensitive ads; and with not spooking/startling the user with "how the hell do they know this about me" - sometimes the user needs to be e.g. logged in so that he understands why he received an ad).
In particular, there are large swaths of companies that don't care whether it's you, your wife or your child - Disney e.g. will happily serve you ads based on activity performed by your children or wife, and will make no effort to figure out if it was you or them because it doesn't matter.