What's the straightdope on refferal advertising to get free products?

Factual Questions
1

This came to my attention yesterday. When I saw an eBay listing for a HDTV and xbox 360 bundle for £75 (but only to pre approved bidders). The listing ended with no bids, but ill get to that later. I have two questions ?

(1) I have seen proof and even a video clip from the bbc which shows that you can get free things (TVs, Xboxs, ipods etc) by signing up to a site and then reffering people to such a site and getting them to complete an offer. Which is an affiliate link and makes the free-product-site the money with which to buy the TV.
My first questions are: how well does this work? is it easy to get refferals? then how long until I get my free TV once I have reffered the 25 people?

(2) Are you aloud to promote these links on ebay? My understanding was that you have to sell something on ebay in order to have a listing on the site. What happened to me yesterday went like this.

The TV Xbox360 bundle was listed at £75 no reserve, no buy it now option. I emailed the seller to check that he was selling a TV and an Xbox and he said he was. Ok so then I emailed him to ask if I could be a pre approved bidder. I didnt get a responce until the auction had ended. I tried to bid any way but was told I was not pre-approved.

So I think this guy is having an auction but not letting anyone bid. I think this is ok by eBay, then he sent me the bellow email, is this how he promotes his refferal thing? by sending all bidders the same email ?

What do you all think?

<email>
Hi and thanks for your interest in the Samsung LCD TV I had for sale. Unfortunately, I have received an offer that I couldn’t refuse and have taken that, sorry.

I was able to let the TV go for a bargain because I actually got it free. Yes, no kidding…free. Take a look yourself now:

http://ForFree4U.com

You will be asked to take out just one sponsored offer. I recommend LOVEFiLM; not only are they a fantastic company but the offer is a free trial!

Not sure? Take just two minutes to browse www.exceem.co.uk and you will be convinced like I was. This post makes particularly interesting reading ! http://www.exceem.co.uk/forums/showthread.php?t=11598

Thanks for looking.

www.gadgets4nowt.co.uk
</email>

2

I’m sure you didn’t mean to have refferal codes in the http://ForFree4U.com link so I have notified the moderators about it.

Basicly it’s a pyrmid scheme because as more people join and reffer people it it, there are less people behind them available for the offers. At one point you will have signed up to help a friend get their swag, but no one can help you.

I know there are some forums out there dedicated to these schemes where they assign people to sign up under you in order for them to join the forum.