It was really hard for me to get from $2/day to $10/day. Surprisingly it was about just as hard to go from $10/day to around $50/day. So I guess my next step would be to go for $250/day. As for jumping from $5-10 to $1,000? I say go for it. As long as you can actually push yourself enough to take the goal seriously. It is not unreasonable at all. Look at DP. This sight must make more than $1,000/day, actually I wouldn't be all that surprised if it was at something like $10,000/day.
Interesting excerpt from Wikipedia about Matt Drudge's website: "A story by Business 2.0 magazine from April 2003 estimated that Drudge's website pulled in $3,500 a day in advertising revenues." Of course, he's the exception to the rule, but it does show that it's possible to make over $1,000 a day.
I'm guessing because of the ridiculous amount of traffic that site gets: VISITS TO DRUDGE 4/28/06 11,033,558 IN PAST 24 HOURS 289,974,806 IN PAST 31 DAYS 3,605,685,472 IN PAST YEAR
There is a canadian dating site called plentyoffish.com that makes $10000 (ten thousand dollars) a day from AdSense. In fact this is the #1 AdSense site in Canada, nobody makes more. The site has been featured in every AdSense related blog, here is just one example http://scobleizer.wordpress.com/2006/03/04/the-role-of-anti-marketing-design/
Did you notice the phrases below the ads "Support The DrudgeReport; Visit Our Advertisers"? The ads are not from Adsense... This is a clear TOS violation!
Even though that's true, I doubt the advertisers care in his case because they make so much money off of that site also.
Because Adsense ads don't pay the really big bucks. I heard Blogads pays $6+ for every 1000 page impressions. I could make a killing off of that. But you have to be referred by someone in the Blogads network.
If you have good blog with a lot of visitors you can write to them or you can try to search for invites in Google or in forums like this one.