Last night I mucked around with the new "Advertise on this Site" option on AdSense. I did so while wearing the webmaster hat for my main hobby site. The "Advertise on this Site" link doesn't ever really appear there since I've one publisher who already cleverly targets image banners there for me.
As already noted by the AdSense community the "Advertise on this Site" option is horribly bare bones. We're encouraged not to set up separate AdSense accounts for every site but keep them all together under one (this blog, for example, is part of the same account).
The "this Site" concept is broken. Most of us have a number of sites. If you click on the "Advertise on this Site" option on Search Commands then you get the page I designed for GameWyrd. It's odd Google let the feature go live when it is badly targeted.
I was frustrated by the lack of space too. I wanted to explain how GameWyrd uses AdSense on my page. I prefer to sell cheap banners to community publishers as that's what I want to appear on the site. Google AdSense fills any gaps I have in the banner rotation. There's simply not enough character space to say this.
I'm really far from impressed with the feature so far.