This article in the New York Times discusses the business of paid reviews. Apparently John Locke used them to great effect, something he just so happened to have left out of his how-to book.
Obviously I have huge problems with this on principle, so I am going to point out that:
1. The reviewers did not actually read the books. (So Locke's fantasy that he was buying reviews "from people that [sic] were honest"? Uh, yeah--honest people don't sell reviews.)
2. At least some of the reviews got pulled by Amazon.
If you think it's worth it to pay money for a vague "This is great, whatever it is!" review that may vanish, then I guess I can't stop you, but I suggest that you look past Locke. The guy who Locke hired was at one point making $28,000 a month, which means that he had between 28 and 280 clients every month, and only one of them managed to break out. The article also mentions another novelist who has spent $20,000 (!!!) on reviews and is no bestseller.
Also, it should be noted that Amazon doesn't pull paid reviews because they're some self-appointed Guardian of Reviewing Ethics. They pull them because customers don't like them. I mean, look at Yelp--I used to go there all the time to search for good local businesses, but I got steered VERY wrong a couple of times by bullshit reviews, and now I don't rely on them any more. Amazon really does not want that to happen, and I think that if you hope to sell there, you should appreciate their efforts to stay popular with customers.
I realize that giveaways at places like Library Thing can be unpredictable, but honest reviews frankly are more valuable to writers than paid reviews. Paid reviews are like edits written by your mom--totally uncritical, totally positive, and totally worthless as feedback. Honest reviews give you a wealth of information about how well you are positioning your book and what could be improved.
In addition, honest reviews are a far more valuable source of information to readers, who, it should be remembered, are completely hopeless when it comes to agreeing on what makes a book good. Reviews help you target your book: If everyone is gushing over your book because it's such a wonderful romance, I probably won't buy it. Believe it or not, that's exactly what you want.