"(in your editor's opinion) seems somewhat contradicted by the fact that they have a hard time pitching stories which do not appeal to advertisers"
You're mistaking how it works in mainstream publishing land. All that the the publishers care about it, for now, are raw hits. Whether the story has anything to do with whatever their advertisers are trying to push is besides the point. Ever wonder, for example, why there are so many dumb slide-shows? It's because, each slide counts as a click.
Now, the stories in a tech, publication have to have something to do with technology, but, trust me, if most publishers could figure out a way to do a slide show of Lindsay Lohan, Kelly Brock, and Eva Mendes--maybe if they were all holding smartphones?--it would be up in a second.
That's not true of all of them, but it is all too true of most of them.
And yes I know, publishing is broken. The business people are still looking for a business plan that works. I just write here myself. I've always steered well clear of the publishing/ad side of the biz.
FWIW, I think what you've been doing with LWN makes a lot of sense. It's not a plan that would work for everyone, but it clearly is a way to get high-quality technology news to hard-core Linux developers, admins, and fans.