[patmcc]

Is it actually confusing anyone? If I search for Pepsi and some of the ads are for Coke or Dr Pepper, that seems fine to me. If it's counterfeit Pepsi or something that's clearly a different case, but if someone searches "ebay mittens" I don't think it's ridiculous to allow a mitten store to have an ad that says "we sell mittens too!".

[akcreek]

It definitely confuses our customers. We fairly regularly receive unpleasant tickets asking where their order is. Once we dig in we often find they did not order with us, but with a competitor who they thought was us.

[ben-schaaf]

The worse I've seen has been malicious malware spreading with an exact copy of the company site. There's also morally/legally dubious combative advertising eg: "Better than X" when searching for X.

Best part of course is that Google has been constantly making it less clear whether something is an ad, so the tricking is really primarily done by Google themselves. The advertising is really just paying to be the first search result.