But if all the people who can afford
  to buy stuff buy "no ads"

Have you ever heard of a newspaper editor complaining "Too many of our readers are paying subscribers" ?

I haven't - seems to me that's a problem a lot of publications would love to have!

Newspaper subscribers still see ads... that's the whole point of this discussion.

That's a fair point, but realistically, everyone won't be paying to hide ads - lots of people would prefer to browse for free, even if they could afford the subscription.

The people that can afford to pay and do not is a less valuable population than the people that can afford to pay and do.

Edit: valuable from an advertisement point of view.

Indeed, which is how we got into this comment thread to begin with. Personally I'd gladly pay to hide ads in services I use frequently, but that also makes me more attractive to the advertisers. Fortunately most services that I use that have an ad-free option have also kept it ad-free, at least for now.