Trent made a point later on the nin forum that allowing people to choose how much your product is worth really devalues it, but offering it at a cheap but fair price (say $5) doesn't devalue it.
Personally I think the best model is setting a cheap bottom line that people can pay for your product, and letting them pay more if they feel it is worth more (adding extra stuff for the people who pay more is good too, like a physical copy of the CD for people who pay $20). You don't have to use your bandwidth to give it out for free, the pirates will do that and I think it's safe to say that if someone pirates your album they are probably going to turn into a fan (or be turned off).
And I downloaded Niggy Tardust for free. I did this because I had never heard Saul Williams and wanted to support an artist who I had never heard of. But after listening to it, I honestly just didn't like it, so I did not go back and buy it.
I wonder how many people were like me and downloaded it for free because of the experiment and Trent Reznor's involvement but didn't pay because it wasn't their style of music.