1. I have found some great bands that I wouldn't have known about otherwise using Last.fm which I then purchased through iTunes. Just because you use a radio type service doesn't mean you don't use iTunes.Why not just pay for your music. Everytime someone plays a song on these phony radio/spotify services, the artist makes about a cent.
Some one will definitely find a way to remove the ads.
2. There is a way to remove ads. It's $25 a year and called iTunes Match.