I think the best idea for directories owners is to accept free listings in order to have huge amount of content then charge for premium listings. Many of the directories out there are not worth paying to get listed because they do not get more than 20 visitors at day. Just check their Alexa ranking before paying to be listed or linking out websites.
I wouldn't depend on free submission to make content and no good directory would do so, i can tell you that most of web sites submitted to my directory and im sure to most of the directories are either spam web sites or violating all the guidelines and rules of a directory for being accepted. A good directory would not wait for content to come to them, they would go and look for it rather than waiting to get from every 100 submission a submission which deserve to be listed that is if this submission has been submitted according to the rules of the directory. As for Alexa ranking and its statistic, you must know that it can be fooled easily. Good websites or web directories have good reputation in the market and that's what i would go for and then i would check the pr, Alexa ranking, etc...
I don't believe we need to spend such money. After all, there are other ways to get the same quality of backlinks and the money be better off put into something else.