Actually, the more I think about it, the more I get the idea that the Chumby 101 widgets are there so that they can have something during the intervals for the ads, perhaps as a test of some sort to figure out what ad intervals people like (at what point do the ads come up so much that people find them annoying), and, obviously, so that they can have a way of informing users of new Chumby functionality (say, the accelerometer based widget switching when the new CP is out of beta).
I do think that they 101 widgets themselves should be toned down. If they are being used as a test of how often ad's should appear, they could perhaps mix it up a little. Seeing the same ad telling you how to use your Chumby gets annoying quickly.
Wrybeard, the purchase price of the Chumby is the cost of the hardware itself and any software on it. The ads are the price of using the Chumby network. I get the frustration at the fact that you paid for something which displays ads every once in a while, but could you suggest something else? The costs of running any type of network can't be absorbed because the markup on the Chumby unit itself is, IIRC, nil or nearly nil.
So, what do you suggest? Should they raise the Chumby's price? Should they offer subscriptions to the network? Whatever you suggest, remember that their stated goal is to grow the network. They want their content network to be used by other companies, and that the Chumby is a means to that end. The whole model is about getting other companies to use the network and make money by selling the advertising.
Of course, if I remembered that incorrectly, it would be nice if one of the Chumbians would step in and explain where I was mistaken.