You're comparing the $20 per-copy cost of NWN to the total amount of $40k for this game
project? The free software community is awfully large, if 40k individual people looked at
this game and decided to donate $1 and never played anything other than the demo levels, then
this project would be successful. There are people that will donate simply because of what
this project is trying to accomplish.
I agree with the idea that this "ransom" model is worth exploring. It may prove useful for
other kinds of software, not just games.
As for this particular project, if the game sucks, people may still peruse the code and look
for ways to improve it. Thats the idea anyway.