Craiggers is powered by the 3taps API that just launched a month ago. They postulate that postings are facts, which are public domain. http://ww1.prweb.com/prfiles/2011/03/06/39377/ADataCommonsin...
Craigslist posts aren't facts, they are works that the authors grant a copyright to Craiglists for.
Even if a craigslist post is a fact, collections of facts like recipe books are copywritable. Not to mention that the way they are harvesting these facts is in violation of the TOS like you pointed out. They'll likely a) get sued and/or b) figure out a licensing deal.