I've read most of the postings on this thread. Yes, thank heavens the voice of reason has surfaced. May I come in on a few points here... My Club would not survive if everyone who plays didn't pay!
Not everyone is top quality - they'd be playing elsewhere if they were, and getting paid for it.
We have a guy- he's only allowed to sing on singer's nights. He's so bad he's become a cult figure.
My duo TDL are often thought c**p, but we too are a cult, and are constantly surprised when our songs go down well. We were interviewed on local radio today, because they had heard about us.
These open mic/ singers nights are just that. You never know who may turn up, and good, bad, or indifferent, they all deserve a hearing without the organiser's ego getting in the way.