Oh, I can help you with this!
First off. Are you using the adsense widget or are you C&P your html code from adsense? I have found that I made NOTHING on the adsense widget, even though they had my publisher ID correct.
So when you are in adsense, you need to create ads that are text/image or image only ads. In the setup, you can choose what color scheme you want, so they will fit well in your blog. You get more money for bigger ads - if someone clicks on a small text ad on my blog, for isntance, I get like a quarter. If someone clicks on a small banner, I get almost two dollars. (The price will depend on your page impressions. The more impressions you get, the more your ads will pay.)
If you ever visit my site, you will see where I put my adsense ads. THis has been for me the best placement, money wise. Still, I don't make much at all through adsense. I have made most of my money (which isn't a lot, BTW) through sponsors.
On my page, I do have a YOUR AD HERE!!! banner, and my contact info is all over the place. THis is how I got my big sponsor. Oh also, I use twitter and other sites to market the hell out of my blog, so that the right people are seeing me. The person who bought the adspace on my blog was actually a marketing firm, and they bought the ad for their client.
When i sold the ad, I offered to do a free review of the client's product, if they would send me a sample. (I love free stuff!) And then i said I would do a giveawway if they sent me two of their product - one to sample, one to give away. Not only did they give me free products (which are on their way) but I also got a pretty large gift certificate to their store. And what woman can resist a gift certificate to a huge organic beauty store??? Not this one, that's for sure.
There's a LOT more that I did to promote myself and get ads, too much to write here. But I'd love to chat with anyone interested in this - I'm on Yahoo IM, you can reach me through my profile. I'm nice to talk to, swearz.