SomeCreep -
thats exactly the way LLs used to look too - till we started rotating links alphabetically. You might take a look at Yahoos directory if you really want to see spam.
Looks to me like some people figured out all ya need to do is start the name of your site with two a's to place at the top - I dont think Id consider that spam though - just smart free site builders for the time back then
I guess my real question still is - what part of that sucks? Its not like a surfer is just gonna pick the first site - hell - I have loads of free sites in the directory from four years ago that still get hits every day - what makes it any different than having that site listed at 100 LLs? I can only see the good side of it with all the extra benefits it gives me in Google - Ive got 4 page free sites that still rank in the top 10 for 3 word targetted phrases that have dropped off the LLs years ago - but Google loves those backlinks
To me its just another source of good traffic that makes me money