Affiliate sites like this one, freelancing work for a number of different tasks (writing, transcription, data entry, personal assistants, etc.), setting up an informational business around your particular area of expertise, etc. The case like the one detailed by wheelinallover sounds like it suffered from a complete lack of marketing -- the internet is practically a boundless space, you can't just set up a site and expect people to find it, you have to actively market the site to drive well-targeted customers to it, and then have plenty of obvious value to offer them in order to get repeat customers and conversions.
I started as a freelance writer with nothing -- my first job was for $75, and so I decided that I would use that whole $75 on Elance (the site where I got that first job) for subscription fees and additional "connects" to allow me to bid on more. I figured that if I hit the end of that $75 and hadn't made any more, then I would give up. I have now been a full-time freelancer for almost four years. That said, I put herculean effort into my business for the first few months just trying to get my foot in the door, worked plenty of 80-hour weeks with a lot of unbillable hours as I learned the ins and outs of writing proposals, finding good client matches, and otherwise effectively marketing myself. Now I have been able to readjust to where I am working 4-6 hour days, five days a week, and making the same amount as I did in those first exhausting months.
Remember that work online is still work, and often a lot more work than you would put into a "9-5" -- at least until you find your particular niche and are able to get substantial recurring revenue. You have to have a lot of self-motivation and discipline, but if you have a compelling reason to pursue self-employment then it can be a really rewarding career. If you have specific questions about getting started freelancing, some great ways to earn with affiliate sites like this one, or details on marketing, feel free to ask me the question and I'll gladly write you a hub :).