I spit out some conjecture:
http://blog.homoeoteleuton.com/monetizing-free/
tl;dr: To make a truly free game, you need everyone to have the same potential play experience except you probably can't have a free print version (though you can try to make a very cheap one; one of the things I'm doing with Segira is making it have a strict 32 page limit—a booklet print of Segira should be achievable fairly cheaply at a POD vendor.
Crowdfunding seems most likely to result in finished products with a good budget, but the downside is finding a way to secure those funds without ostracizing your audience or failing to offer anything of value.
Also, I'm self-funding at least part of PROJECT HAMMER and all of Segira. Pity me.