When you think it's okay to use a copyrighted song in its entirety in a video just because you're an amateur, what you're saying is that you're fine with releasing somebody else's work to the world without anybody making a dime. The people complaining about this lawsuit are saying they're mad because using somebody else's work without compensation should be completely fine. That devalues music.
It would be like if I stole the source code to Basecamp to release a free application, then defended myself to 37signals by saying I wasn't making money off it. I'm not more innocent because I was hypothetically releasing my work for free. In fact, in a way it's even worse because I've suddenly devalued Basecamp, which makes money off people who think it's worth something and have no choice but to pay if they want it.
(Actually, looking at Marco's post before this, I think I misinterpreted him: He agrees with my belief that the Vimeo thing is copyright infringement, and simply is saying that Creative Commons will let musicians flourish without breaking laws.)