I don't believe click fraud is profitable for Google in the long term. The more click fraud out there the lower the conversion rate for advertisers. Result: advertisers allocate a smaller percentage of their total advertising budget to Adwords. Google's fortunes are surely linked to that of their advertisers.
I guess the 1.1 billion people who live on less than $1 per day. Admittedly most of them don't have access to a PC, but a third world entrepreneur could probably help with that.
[edited by: StuWhite at 11:45 am (utc) on Oct. 23, 2006]