I might sound like a snob, but I have a hard time taking a site designed like this seriously, I don't care how many users or traffic he claims to have.
As far as dating site designs go, OkCupid looks great.
As many as Craigslist is "loosing," I suspect.
I'd say he knows his target audience well enough to make that decision himself. There is indeed such a thing as being too polished. The reason late-night TV commercials are cheesy and loud is not because the director lacks the skills but rather because it suits the target market. If POF redesigned their site to look like a glamor magazine website, he might indeed lose a lot of users because they might be intimidated by the design.
Its less than 5 minutes worth of work to fix that.
A lot of people have been saying that Craigslist should have better design, more search options, etc but the site is still popular.
On page 4 it discusses exactly that.
But I agree with you, the design is painful to look at, and usability could be improved a lot. Why he doesn't clean things up a bit is beyond me.
But then, compared to the competitors, POF may not look so pretty, but functionally it is quite good.
If POF's UI was really slick, it might look too commercial for some people.
Through the years we've watched the competition go through one design after another and try all kinds of SEO, but our crappy, framed, obtrusive javascript website still outranks them. The only downside is the constant calls we get from SEO and design firms offering to "help us out".