Digg does quite well on "sponsorship" type advertising. I.e. they add a new feature, or a labs thing, and get Cisco or Intel or someone to sponsor it.

But how long can they sustain that for?

It's possible that they set up some kind of revenue share w/ partner sites. Perhaps they get a share of the revenue from big players who feature a "Digg this" button. At the same time, the less traditional Digg users who come from sites like the WSJ or NYT are going to be more monetizable (for Digg) since they aren't going to be the standard issue Digg user/commenter who uses Adblock.

And AdblockPlus blocks most Advertisements.

So far as I know it is.