I like this. Perhaps we could start with the button and then if OUR GLORIOUS BENEFACTOR sees that he's making up some of the cost with that then he might be willing to take the ads off. How does that sound?
I honestly have no idea. I don't think the ads generate much but it's better than nothing - easier for OUR GLORIOUS BENEFACTOR to justify having 1km1kt on a spiffing high power production server with oodles of room. However, if we can show that a donate button is a regular source of income then we might persuade him to bin the ads.
A donate button would be nice, but it probably cannot replace the ads. I hate to be the cynical one here, but generally, the more people have to do, the less likely they are to take that step. One click ads are easy, logging into pay-pal or getting out your credit card is that many more steps, physical reminders of what your doing, and cost the person money rather than some odd profit sharing company.
That said, being able to pay for the contest rewards from donations rather than out of pocket would be a nice boon, and with 500+ games going back to 2004 a little insurance/back-up wouldn't be bad. (That is 66 pages of stuff at the moment - we might need a way navigate the archive a bit quicker.)
I'm suddenly having visions of Valve - where you can donate to the authors of content you like in TF2. But that would be a hell of a system to set up on both ends, and the ones who spend the most time running the site aren't necessarily the ones who contribute the most material - so that doesn't help the site as a whole. Heck, for tax/business purposes, that would probably make things worse... Probably best you just ignore this paragraph...
Games of imagination are never truly done. Yet tomorrow we shall start another one.