Well, you may not see banner or text ads, but do you read news? Their last post in it had an ad/sponsorship for a contest for a company called "Nature Made". I'm not pointing that out to say that you should necessarily care about that or hate it, since it's not as if it's flashy or possibly carrying malware, so much as to point out that it can be very difficult for LJ to effectively pursue advertising revenue beyond banner ads while still making sure paid/perm users don't see it, so some things slip through. Things along this line also include sponsored layouts, sponsored v-gifts, and sponsored mood themes--LJ has done them in the past and might do them in the future.

Another factor of ads is in the way it affects design and business decisions; this can affect the paid/permanent user experience as well, as features designed to encourage advertising and sponsorship revenue might be suboptimal if only considering user needs. This is another reason why people might dislike ads on a service, even if they never see them.