To break it down- the routers use a Belkin IP address as a DNS relay, when it couldn't reach that address the router responded with the error. So the problem was that their internet facing DNS server went down. It's pretty poor that they dont have backup DNS servers but it's not the end of the world it's not as if their backdooring fubarred firmware onto the routers.

Not according to the article. Belkin claims that it was a problem with the server they used to allow the router to check for internet connectivity.

If it comes out that Belkin is actually routing their users through their own DNS, I would hope it would be a huge privacy scandal.

There is no reason for them to run a DNS infrastructure for their clients, and doing so provides them no direct benefit, has no clear applications for building routers at all, costs money to maintain, and is a huge point of failure.

I can't imagine them doing such a thing for a few advertising dollars.. the only reason a router company would do that is if they were paid by the government or something. This way Belkin could reroute your internet traffic through whoever's servers whenever they wanted, and you would likely never know.

Anyway, that sounds a bit far-fetched, so I'm going to hope that Belkin is telling the truth.

They are because the ISP is supposed to provide DNS. That's what you're paying the ISP for. If the ISP paid belkin to run the DNS servers then yeah, that's no big thing, just a service outage.