Brad: it does look like that for me, so it's fine at least on my computer. I'm also seeing the expandable flash ad on top of the dimmed screen (except that it's not obscuring the login box for me unless it is in its expanded state).
Having a normal image ad in its place would be nicer though, or at least tweaking the code so that it respects z-order (I'm guessing it's not supposed to appear on top of the screen like it does)
PurrBall: just install AdBlock-Plus (on Firefox) or AdThwart (or some other adblocking plugin, on Chrome) and don't look back.
Having only the two ad blocks on the bottom would be fine IMO, the huge one on top makes it so that there is almost more ad space on the main column than actual site content shown. Moving it to a right-column ad like on the current site would be nicer if that's possible.