Replying to both the guy in the thread and the guy who PM'd me about blocking ads in games:
Stumpokapow said:
Boy do I really hate ads that appear in games that I've bought. ngmoco

games and AdMob ads in particular annoy me. I've managed to block all the AdMob ads (although some apps using them detect that I'm blocking them, so those don't work, but not the ngmoco ones yet.
I haven't managed to block ads in ngmoco

games yet (partially because even if I block the asset downloading for the ads, the games keep a local cache of advertising to display; which is kind of impressively evil when you think about it), but I have blocked ads in most other games.
By far the most popular service for mobile game advertising is AdMob. Their ads are served from
mm.admob.com. So, what I did was edit the iPhone's hosts file and redirected that domain to localhost.
Full instructions:
1. Jailbreak iPhone--you should be doing this anyway. There is no real downside and many Cydia utilities are awesome (particularly Mobile Safari AdBlock and Poof)
2. Install OpenSSH via Cydia. This essentially allows you to remote connect to your iPhone.
3. Use an FTP client to connect to your iPhone. The address will be your iPhone's IP address (Settings ->Wifi -> Details -> IP Address). The username is root. The password is alpine. You want to be in
SFTP mode. You'll also have to have your iPhone on the same network as your computer, so I guess you'll need a wireless router.
4. You should be in /private/var/root/. Change directory to /etc/. Download the HOSTS file to your computer. There is no file extension.
5. Add the following line to the end (including the extra line-breaks):
127.0.0.1 mm.admob.com
6. Save the file. Make sure you don't add a file extension. Upload it back to the iPhone. Replace the file. You're done.
7. Consider uninstalling OpenSSH both for security reasons and because it's a battery drain. The entire process took me maybe 5 minutes.
Some apps are smart enough to detect that you're using an ad blocker and will not boot. If you are using one of those apps, they will generally prompt you "HEY GUY YOU ARE AD BLOCKING THAT MAKES ME MAD EVEN THOUGH YOU BOUGHT MY PROGRAM YOU DON'T OWN IT PLZ DISABLE AD BLOCK". I haven't come across any games that do this, just a few apps--BossPrefs/SBSettings from Cydia. It also interferes with the Categories Cydia app.
Also note that you can use the hosts file to block any server. ngmoco

uses assets.ngmoco.com to serve advertising assets--I just need to figure out how to destroy the local cache as well. After work today I will take another stab at it.
You can also block servers like doubleclick.net to block ads in Safari and elsewhere--but I recommend Mobile Safari Adblock for that purpose (note: MSA does not have a manual whitelist, so if you're the kind of guy that blocks ads in general but allows them for trusted sites like GAF, don't run it)