I was reading the Yahoo! Directory Submit Service Agreement and is a part were it reads: "Inclusion in the Directory is not guaranteed. Subject to the terms below, and in Yahoo!'s sole discretion" and my question for those who had applied to yahoo dir, any of you have been denied by yahoo dir?
What they mean is that paying a fee of $299 does not guarantee for inclusion in yahoo directory. If your site looks spammy,under construction, pages are not linked properly(navigation problems) or contain abusive or racist remarks. These are just some of the factors that can disqualify to have your site listed in the directory, which means a forfeit of your $299 fee. Apart from that I think there is no reason why you should not have your site listed in the directory once you made the payment.
i heard somewhere a long time ago that yahoo would maybe accept non profitable sites for free but they might not do that anymore besides the yahoo directory has lost its worth in my opinion save your money
Back in the Day they took on free applications and often approved. Today unless you are willing to drop some cash then you likely won't get in. And the fact they do not guarantee is kind of a barrier for entry for those on the fringe.
I've got one site listed in Y! and it generates perhaps one or two hits per day. Frankly, I don't think it's worth the expense.