Reply I got from WordPress ADS
Your WordAds application has not been approved yet. What you’re seeing are the standard WordPress.com ads.
To support the service (and keep free features free), we sometimes run advertisements, and the agreement for this has been in our terms of service since 2006.
We try hard to only run them in limited places. If you would like to completely eliminate ads from appearing on your blog, we offer the No-Ads Upgrade: http://store.wordpress.com/premium-upgrades/ad-free/
Regarding your application, our advertising partners do have a minimum traffic threshold. Looking at your page views, it’s not possible to earn meaningful earnings given your traffic levels. A site generally needs thousands of page views each month to earn meaningful earnings. As your traffic grows we will continue to apply to get ads activated.
For now, I recommend reading this guide: http://en.support.wordpress.com/getting-more-views-and-traffic/
I want to strongly emphasize sharing your blog with your friends and family. If they like it, they’ll share it with their friends, and so on.