Hi there and welcome to the board.
On a first glimp your freesite looks very good, you've certainly done your research it appears. Your warning box does look a bit messed up in Firefox, you should check your freesites in different browsers to see if it's compatible with them. Firefox, IE, Safari are the most used so that would probably do.
The purpose of freesites... well it's just another way of promoting sites just like you do with blogs or TGP galleries. The more ways you promote a site the more money you're likely to make. The advantage of freesites is that you send the surfers through 2 pages of ads before they reach the content. Also you might get a bit of SE traffic to your "mini-site" but with all the recent google changes I'm not betting anything on that anymore.
Good sites to submit your freesites to. Well if you have a bit of patience just check my sig
There are quite a few Linklists out there that would be happy to list your sites. Here's one of my freesites, you should check out the LL's on there.
http://www.freeporncorner.com/fetish...-abused-asian/
And about that making tons of cash thing, like with everything else in this business, don't get your hopes up too high
Succes with your freesite building challenge!